Glu Mobile Scaling Back on Celebrity Games

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Glu Mobile is scaling back its celebrity licensed mobile games this year after three – “Katy Perry Pop,” “Britney Spears: American Dream” and “Nicki Minaj: The Empire” – weren’t “commercially successful,” the company said in its annual 10K.

Glu plans to release two titles this year – a Taylor Swift game and version of its Tap Sports Baseball with a Major League Baseball (MLB) license – down from seven a year ago. None of Glu’s celebrity games have come close to matching the performance of its first, the wildly successful “Kim Kardashian: Hollywood.”

As a sign of struggle in its licensed celebrity business, Glu Mobile took a $20.2 million impairment charge in 2016 for guarantees paid to celebrities. The company expects to pay $26.4 million in royalty advances this year and has forecast revenue from the new Swift title “conservatively,” CFO Eric Ludwig told analysts.

“We don’t know what the future of celebrity is, so we are being sort of thoughtful how we build it into our numbers,” CEO Nick Earl said. “We have taken a pretty low view (in revenue) in terms of the guidance from the Taylor side opportunity.”

After its first Kim Kardashian title in June 2014 proved to be a strong revenue generator, Glu Mobile was quick to follow with additional celebrity titles. But even a second Kardashian title “has not been great,” Earl said. “It has really forced us to take a really hard look at what we want to do with celebrities going forward,” Earl said.

Contact:

Glu Mobile, Eric Ludwig, Chief Financial Officer, 415-800-6100