Shares of Glu Mobile (NASDAQ:GLUU) hit another two-year high on Wednesday. The mobile games publisher has been on a roll since posting blowout financial results last week. The stock moved 22% higher last week, and it has soared 171% since the start of last year.
Mobile gaming can be fickle, and usually when a developer has a big hit on its hands it gets gobbled up the way that Candy Crush Saga parent King Digital and Clash of Clans publisher Supercell were bought out. Glu has been able to piece several modest hits together, dating back to Kim Kardashian: Hollywood in 2014.
Glu Mobile had a monster quarter. Bookings reached a record $86.3 million, roughly $13 million ahead of the midpoint of its guidance. It won't be a fluke. Glu is raising its full-year guidance on bookings by $35 million, so the best is yet to come. Glu is now targeting $360 million to $370 million.
Glu credits its strong quarter to the continuing success of Design Home, Covet Fashion, and even Kim Kardashian: Hollywood. All three properties showed sequential gains in bookings, clocking in at $34.3 million, $12.2 million, and $10.5 million, respectively for the quarter. Three properties accounting for two-thirds of Glu's bookings may seem like a heavy concentration, but that's the nature of mobile gaming. A lot of the heavy hitters often lean on just a single title for the lion's share of their business.
The focus at Glu has been to increase engagement, and it seems to be paying off. The near-term outlook is strong, and not just because the first quarter's three biggest contributors have favorable momentum. MLB Tap Sports Baseball 2018 was released late in the quarter, but its real contributions come in the spring when baseball season is under way. Bookings with the baseball simulator have grown with every passing annual update.
They won't all be winners. Glu's plan to put out other celebrity-based games hasn't matched the initial success of Kardashian's entry four years ago. Even the Taylor Swift-backed The Swift Life social hub didn't live up to the hype. Thankfully for Glu and its growing pipeline of titles, it can afford to fail here and there. If the highly anticipated WWE wrestling game falls short -- something that doesn't seem likely since it's built on the same proven MLB Tap Sports Baseball engine -- it can tag out and have another grappler come into the ring.
Glu shares are still not close to where they were when Kim Kardashian: Hollywood was all the rage, but the developer is now a more balanced publisher of sticky casual mobile games. Wednesday's fresh two-year high won't be the last time this happens if it can keep its growing audience engaged.