Revenues and profits at Dublin-based games development company Digit Game Studios jumped in 2021 as the pandemic continued to drive a surge in demand for mobile games and interactive entertainment generally.
In recently filed accounts, the developer, which was acquired by US game publisher and developer Scopely in 2019 for an undisclosed sum, has reported turnover of close to €20.6 million for 2021, an increase of more than 54 per cent from 2020.
Operating profits at Digit, meanwhile, climbed by more than 62 per cent to nearly €17.6 million, mostly driven by the continued success of its popular Star Trek Fleet Command game.
In a report attached to the accounts, the directors of the company, which employed 98 people at its offices on City Quay in Dublin 2 last year, said the strategy/MMO (massively multiplayer online) game “is competing well in the marketplace”. However, they said the environment remains “extremely competitive with multiple competing games targeting a similar market”.
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The accounts note that the company’s revenues are derived from a revenue share agreement between Digit and Scopely. It also receives income from Scopely for the provision of live operations services – updates and improvements to the game – which topped €14.4 million in 2021, up more than €3.7 million from 2020.
The company also availed of Government research and development credits worth €1.3 million in 2021.
“This increase is primarily as a result of continued investment in the Star Trek Fleet Command Game,” the directors said.
Administrative expenses at Digit, who could not be reached for comment, also increased 22 per cent in the year to more than €16.6 million due to “increased development activity”.
Developed by Digit and launched in conjunction with Scopely and CBS Interactive in 2018, Star Trek Fleet Command, which is available on IOS and Android, is free to play but generates revenues through in-app purchases. It was the fastest Scopely published title to surpass $100 million in lifetime revenue, doing so less than a year after it was launched.
Scopely then acquired Digit Game Studios – founded in 2012 by former Jolt Gaming chief executive Richard Barnwell, David McGovern and Fergus Duggan – in May 2019.
The accounts note than Mr Barnwell, who subsequently joined Dublin-based venture capital firm Delta Partners as a partner, resigned from the board in 2021 followed by Mr McGovern in 2022.
With people stuck indoors for significant portions of time over the past three years, the mobile gaming and interactive entertainment markets grew at a frantic pace throughout the pandemic.
However, a slump in revenues this year – brought about by the impact of inflation on discretionary spending and the return of pre-pandemic norms – has forced forecasters to downgrade their expectations for the industry over the coming years.
Analytics company Newzoo has estimated that the mobile gaming revenues could shrink by up to 6.4 per cent this year compared with 2021, with the wider sector expected to shrink by 4.3 per cent year on year.
