Mobile games distributor Flexion generated record quarterly revenue in the last quarter of 2023, making £24.3 million at a 12% year-on-year growth rate. That's up 64% quarter on quarter.
Gross profit, meanwhile, increased by 35% year-on-year to £5 million in Q4, although operating profit decreased to only £0.2 million.
Adjusted EBITDA broke another record for the company by climbing 38% to £2.1 million in the fourth quarter.
On the rise
The tail end of 2023 proved a strong one for Flexion with record-breaking results and a huge 64% increase in revenue over Q3, helping push a successful fiscal year. Q4 saw the company triple its monthly active users year-on-year, up to 4.5 million people.
Deals were signed with Neocraft’s Chronicle of Infinity and Immortal Awakening, Vizor Games’ Klondike Adventures and Special Gamez’s Wolf Game, while an earlier deal with Scopely to bring its smash hit Monopoly GO! to alternative app stores paid off and then some; the game launched less than a year ago and has already generated $2 billion, currently averaging eight million players per day.
Looking at 2023 as a whole, Flexion’s revenue grew 3% to £70.8 million and gross profit increased by 12% to £12.4 million. However, a 12% rise shows much slowdown after the 147% climb seen last year. And just as the fourth quarter fell in operating profit, so too did 2023 at large, down to -£0.3 million. Adjusted EBITDA for the fiscal year fell too, down by 14% to only £4.2 million.
"Looking back at 2023, one of the defining moments was when we launched Monopoly GO! - the top-grossing mobile game in the world - in our channels. Since then, our alternative distribution service has been gaining considerable traction with top developers. As a result, our sales pipeline is stronger than ever, and we are expecting to convert some of these leads in the next few quarters," said Flexion CEO Jens Lauritzson.
"One reason for the stronger developer interest is the difficult user acquisition market, where it is increasingly challenging to achieve positive returns due to changes in user tracking (IDFA) and high store fees. Another is that we continue to see growing expectations from developers in relation to the new regulatory changes such as the Digital Markets Act in Europe, which came into force earlier this month aimed at opening up large ‘gatekeepers’ such as Google and Apple.
"Epic and Spotify are at the centre of this. They have been challenging Apple and Google for years and are now starting to win. This gives the market a further boost of confidence."
After bringing Monopoly GO! to the Samsung Galaxy Store, Huawei's AppGallery, Amazon's store and others, Flexion set its sights on expanding another Scopely game, Stumble Guys.
