What happened
Shares of Glu Mobile (GLUU) climbed 27.9% last month, according to data provided by S&P Global Market Intelligence. On May 7, the mobile game maker reported a solid first-quarter earnings report, with bookings up 15% year over year.
That news was followed with a business update in late May that showed momentum continuing into the second quarter. Management raised its second-quarter and full-year guidance on the back of strong performance from its core growth games, in addition to early results from new releases.
Image source: Getty Images.
So what
Glu Mobile has been focusing more on its growth games lately, including Design Home, Covet Fashion, and MLB Tap Sports Baseball. The 2020 edition of Tap Sports Baseball is off to a strong start, with the highest first-quarter bookings in history. Design Home also turned in record bookings last quarter.
In the business update issued on May 28, CEO Nick Earl said, "Our three growth games, along with Diner DASH Adventures, Kim Kardashian: Hollywood and Disney Sorcerer's Arena, are performing above our expectations, with several setting new records for daily bookings along the way."
Now what
Since the first-quarter earnings report, Glu Mobile has experienced continued growth across its games. As a result, management raised its second-quarter guidance, now calling for bookings to increase 62% year over year based on the midpoint of the range between $162.5 million to $167.5 million. Full-year bookings are expected to be between $502.5 million and $512.5 million, representing an increase of 19.9% over 2019.
What's more, the company has decreased its user acquisition investment in May, which will allow more revenue to flow to the bottom line, improving profitability.
All in all, there was a lot of good news about this video game stock, which has investors feeling good about Glu Mobile's growth prospects.
