The head of Supercell on the results of 2023: "We are on a trajectory of steady growth"

Ilkka Paananen, CEO of Supercell, wrote a program column about the state of the company. He revealed the financial results for 2023 and talked about the new development course for Supercell.

Supercell's performance for 2023

• Supercell's revenue amounted to €1.7 billion. This is 4.2% less than in 2022.
• EBITDA fell by 8.2% year-on-year to €580 million.
• During the year, the company paid taxes to the Finnish treasury in the amount of € 110 million.
• The total revenue of Clash of Clans and Clash Royale for the entire period of operation exceeded $14 billion. Of these, $10 billion is for Clash of Clans.
• Since the summer of 2023, the audience of Brawl Stars has tripled. It is now the most popular Supercell game.
• The monthly active audience of Supercell games has grown to 200 million people.

Paananen explained that the company's revenues have fallen due to ongoing problems in the mobile games market. Nevertheless, Supercell is optimistic about the future. As Paananen pointed out, last year, for all the Supercell hits, each new quarter was better than the previous one. This is the result of changes in the company's strategy.

How is Supercell's strategy changing?

At the beginning of the column, Paananen recalled that at the end of 2022, the company set itself two key tasks: to create new potential hits and develop game services. According to Paananen, not everyone liked this idea. Most of the people he talked to advised him not to change anything for fear it would destroy the Supercell culture.

As an example, Paananen cited several responses from his interlocutors. One of them sounded like this:

"Look at [a great gaming company], they did what you plan to do, and that was the beginning of the end. All the best people just left."

Another person suggested just buying studios with good new games, and Supercell itself focus on developing its hit titles.

After carefully considering everything, Supercell decided not to abandon the plans.

"Nothing can be closer to my heart than the people and culture of Supercell, so the thought that I would do something that would destroy it... there are no words to describe my emotions [...]. But at the same time, you can't ignore the facts. The best-in-class companies work with game services, but we don't (Dream Games, Riot Games, King, Playrix and others). Also, since we released Brawl Stars, there have been several great games that have shown good results (Royal Match, Genshin Impact, MONOPOLY GO!, Call of Duty Mobile), but we have not released any more," Paananen explained his position.

Considering all this, the company decided to do so:

• Now Supercell treats teams that work on new games like startups. They get creative freedom, but are severely limited in resources and are responsible for their own decisions. If the team runs out of money before the game is of interest to users, the game will be closed. Before starting work on the game, developers must define deadlines, key milestones and a cost plan, and then present them to the entire company.;
• It is important for Supercell that the developers of new games show the product to the players as soon as possible and check it "for compliance with the market". Then, if the audience doesn't like the game, the team will have time to change course. Therefore, in the early stages, teams can use not only Supercell technologies, but also others. For example, not the internal engine of the company, but Unity or Unreal Engine;
• when the game starts to "match the market", the team that developed it will move on to the next phase. From a "startup", it will become a service team with a larger number of developers and more resources. In Supercell, such commands are called "Scaleups" from the English "scale up" — "scale". Their task is to support the game and constantly make it better.

According to Paananen, Supercell is still experimenting with the company's structure. Recently, she decided to deepen the so-called cellular model, which she has long adhered to (within the framework of it, the company consists of independent cell teams). She added another level — "subcells". It looks like this: a large independent "cell" with one common task is divided into several "subcells", each of which eventually contributes to the achievement of the main task of the largest "cell".

Unlike many companies that have carried out mass layoffs in recent months, Supercell is actively hiring employees. Now there are 550 people on her staff. According to Paananen, Supercell management is well aware of the risks associated with rapid staff growth and is doing everything possible to avoid them.