Glu Mobile Continues to Hunt for Supersized Value

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

About a month ago, this article on Glu Mobile (NASDAQ: GLUU  ) discussed whether the major hit Deer Hunter 2014 would have staying power. At the time, hope existed that the producer of free games had finally found a method to successfully monetize mobile games. More than a month later, the game remains a huge success, sitting near the top-grossing games on both Apple iOS and Google Play charts, according to The question now isn't if the game will be a success, but how much value this super-sized winner will generate.

The recently announced $3 billion valuation for Clash of the Clans creator Supercell suggests a value potential much higher for Glu Mobile. This news further highlights the potential for Zynga (NASDAQ: ZNGA  ) to generate more value if existing successful franchises can be turned into grossing leaders based on skill-based tournaments and awards

Updated Deer Hunter 2014 numbers
Now a month after the official release of Deer Hunter 2014, the game still remains in the top daily downloads on both Apple iOS and Google Play. For the iPhone, it ranks in the 100 best-grossing apps in 76 countries and has consistently been a top-10 game in the U.S. The constant downloads lead to even further potential for generating revenue. lists the daily revenue on the iOS in the U.S. at around $305,000, with 282,000 daily new users. This site lists Deer Hunter 2014 as the sixth top-grossing game on that platform. The Candy Crush Saga generates roughly $870,000 of revenue per day in the top spot and Clash of Clans drops to $684,000 in the second spot. These numbers bounce around on a daily basis, so interested investors might want to check the numbers often.

Supercell valuation perspective
Anybody not following mobile games closely probably hasn't noticed that the majority of the massive winners have come from relatively obscure publishers. The recent hot hand goes to Supercell, which has created two extremely successful games in Clash of the Clans and Hay Day. According to, both games routinely gross in the top 5 iOS games. Combine that with the fact that the Wall Street Journal released that Supercell generated $178 million in quarterly revenue, and it provides some valuable insight into what Deer Hunter 2014 could be producing.

Considering the private company has only two games in production, those numbers suggest that top game, Clash of the Clans, generated $100 million in revenue, while the second game made around $78 million. With a ranking slightly below those games, this could suggest that Deer Hunter might achieve $50 million in quarterly revenue. Remember that analysts only forecast revenue of $28 million for the quarter, and the company has a hoard of new and old games that should generate at least $20 million.

Can Zynga replicate that success?
The most telling part of the current AppAnnie stats is the general lack of Zynga-listed games in the top 20 or even 50. The domestic iPhone has Zynga Poker ranked 18, and no other game ranks in the top 50. Zynga has good company in Electronic Arts (NASDAQ: EA  ) , listing only The Simpsons: Tapped Out and The Sims FreePlay in the top 30 games. The game list is littered with previously unknown publishers such as, Kabam, Funzio and others. Even previously popular publisher of the Angry Birds franchise, Rovio Entertainment, has mostly disappeared from the top games list.

While Electronic Arts obtains a significant amount of revenue from digital platforms, the megahits still appear mostly unpredictable unless Glu Mobile developed the platform to success with the games as a service initiated with Deer Hunter.

Bottom line
At a market cap below $250 million, Glu Mobile investors continue to hope the success of Deer Hunter 2014 can be replicated in other upcoming fourth-quarter releases such as Motocross Meltdown, Eternity Warriors 3 and Frontline Commando 2. The numbers being generated continue to suggest that Glu Mobile can produce revenue and earnings that far exceed those presented prior to the release of Deer Hunter 2014.

Another key will be whether this success can translate into established players like Electronic Arts and Zynga consistently generating high-grossing games. The rewards could be huge, considering Supercell and its two mobile games are now worth more than all the farms and words created by Zynga and its cash hoard.

Think all the profits in mobile have already been made? Guess again.
The mobile revolution is still in its infancy, but with so many different companies it can be daunting to know how to profit in the space. Fortunately, The Motley Fool has released a free report on mobile named "The Next Trillion-Dollar Revolution" that tells you how. The report describes why this seismic shift will dwarf any other technology revolution seen before it and also names the company at the forefront of the trend. You can access this report today by clicking here -- it's free.

Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2696805, ~/Articles/ArticleHandler.aspx, 9/27/2016 5:01:57 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 7 hours ago Sponsored by:
DOW 18,094.83 -166.62 -0.91%
S&P 500 2,146.10 -18.59 -0.86%
NASD 5,257.49 -48.26 -0.91%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/26/2016 4:00 PM
GLUU $2.19 Down -0.03 -1.35%
Glu Mobile CAPS Rating: **
EA $83.50 Down -0.76 -0.90%
Electronic Arts CAPS Rating: ***
ZNGA $2.83 Down -0.01 -0.35%
Zynga CAPS Rating: *