Already on 26 July, French publisher Gameloft released its Q2 2012 report, showing healthy growth for the mobile-focused company. Sales in the second quarter were up 35% from the same period last year. This is an acceleration compared with to the 14% increase between the 2011 and 2012 first quarters.
Smartphones and tablets games drove sales during the period and were up 119% compared to Q2 2011, for the first time representing more than 50% of sales. The company claims 55 million monthly active users and noted that more than 60% of sales in its smartphone business come from in-app purchases. Off the back of strong results the company has increased sales expectations for the full year by over 20% to EUR 200 million.
Conclusion: Yet another proof of the great momentum within mobile gaming. Big players like EA, Gameloft but also Glu Mobile with its pre-announcement of its Q2 numbers are bullish on the app market. So are we, which is why we think it is incomprehensible that G5 Entertainment’s share price is sitting there around SEK 34-35, valuing this fast growing “app pearl” at less than 11 times expected 2012 earnings. As the market continues to grow and G5 Entertainment continues to deliver as it has done in the past, we think it is only a matter of time until the next phase of revaluation will come.
PS: Want to get exposure to the fast growing app market? Check out app developer and publisher G5 Entertainment (http://nordicinvestor.net/g5-entertainment/)