As always, G5 Entertainment will be releasing its preliminary revenue numbers a few days after the end of the quarter. That means that we can expect Q2 prel numbers sometime during this week.
In light of this, we find it interesting to note that revenues generated by mobile games have continued to increase well through the whole of Q2. As a proxy, we are tracking daily revenues generated for iPhone games in the USA, as provided by www.thinkgaming.com. As you can see in the chart below, there has been a gradual increase of the daily revenues generated ever since the beginning of December. This is a new trend this year and most related to the dominance of the free-to-play games. Unlike traditional unlockable games, free-to-play games do not create the kind of revenue spikes that were related to holiday sales etc. Rather, free-to-play games constantly engage players to buy new content and thereby keep revenues per player at higher levels while at the same time the number of players keeps increasing.
We believe this development bodes well for G5 Entertainment’s operations. The company’s biggest hit, Secret Society, continues to rank around number 35 in the top grossing ipad charts in the US. We do not think that there is any reason to believe that the development on ipad is any different than the development on iphone (as shown by thinkgaming.com). Therefore, Secret Society is likely to have created increasing revenues in Q2 compared with Q1.
We believe that the recent relisting to Nasdaq OMX will lead to increased institutional investments in G5 once the positive operational development has proven to be sustainable. The upcoming Q2 preliminary revenue numbers could be a step into that direction.
Follow the latest buzz around G5 Entertainment at www.buzztrader.se. G5 Entertainment is part of the Nordic Investor BuzzTrader portfolio.