Candy Crush Saga developer King Digital’s (NYSE:KING) miserable time since it floated in New York continued as latest sales disappointed and it was cautious on future revenues.
Shares in the video game app developer slumped by 21% in after hours trading in the US even though it unveiled a US$150mln special dividend.
Profits rose 31% to $165mln in the quarter to June, which was in line with forecasts, but sales missed forecasts at $594mln compared to market expectations of $609mln.
For the whole year, King now expects sales of US$2.25bn to US$2.35bn against its previous forecast of US$2.55bn- US$2.65bn.
The company blamed a decline in Candy Crush income for the lower revenues. King has been bringing out new games to bridge the gap, but its flagship still accounts for 60% of sales.
Riccardo Zacconi, chief executive, told a conference call that Candy Crush’s performance was worse than expected while growth in the newer games had also been slower than forecast.
The decline in bookings, add-ons bought while playing the game, had accelerated toward the end of the quarter, he added.
King went public in March at US$22.50 a share, valuing the firm at US$6bn. Shares were trading at US$14.26 pre-market last night.
At its peak in 2013, almost 100mln people had signed up for Candy Crush with the group’s income almost entirely derived from players buying virtual goods.