Rovio cuts 260 jobs as Angry Birds fever wanes

During its peak, the Angry Birds creator was pulling in revenues upwards of US$200 million. Now, with rapid internal growth belying consumer demand, the Finnish company will lay off 260 employees in a corporate restructuring.
August 26, 2015

During its peak, the Angry Birds brand was helping to generate yearly revenues upwards of US$200 million for creator Rovio Entertainment. Fast forward to 2015, where rapid internal growth has belied consumer demand for the franchise, and the result has led the Finnish developer and publisher to lay off 260 employees in a corporate restructuring.

The company plans to concentrate efforts on three primary business areas: games, media and consumer products. Despite a 9% drop in full-year revenues (to US$180 million) in 2014, Rovio’s games and media businesses revenue grew by 16% and 19% to US$125.9 million and US$7 million, respectively.

However, consumer products licensing revenues have seen significant declines, falling from US$83.2 million in 2013 to US$47.1 million last year, despite measures taken to beef up its global consumer products licensing team with the help of former Mattel, DreamWorks and Warner Bros. execs.

But Rovio has high retail and licensing hopes for the upcoming Angry Birds feature film, which is slated for global release in May 2016 and will be distributed globally by Sony’s Columbia Pictures

In fact, the company-wide job cuts will bypass those working on the production of feature film in the US and Canada. The upcoming 3D CGI-animated feature is based on Rovio’s Angry Birds app and has a reported budget in the US$80-million range.

The current restructuring follows the launch of freemium app Angry Birds 2, which has by all accounts had a successful run so far with more than 50 million downloads in its first month. But the company admits that its ambitions beyond its core mobile gaming business – including its entry into the YA book market – have led to financial uncertainty.

“Rovio’s growth and eagerness to explore new business opportunities over the past few years has been exceptional,” Rovio’s CEO Pekka Rantala said in a statement. “As a result, we did too many things. In our current financial condition we must now put focus on where we are at our best: in creating magnificent gaming experiences, in producing an amazing animation movie and in delighting our fans with great products.”

The company grew its number of employees from 500 to 800 in 2013 to help move its investments forward. Last December, more than 110 employees received pink slips, and the company eventually closed one of its studios inTampere, Finland.

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