Playtika IPO: What Investors Need To Know

Playtika Holding Crop PLTK is set to go public on Friday.

The Offering: The mobile gaming company priced 69.5 million shares at $27 each in its initial public offering late Thursday — ahead of its previously-indicated range of $22 to $24.

The company is valued at close to $11.1 billion at the IPO price.

About Playtika: With a motto of “changing the game,” Playtika offers mobile games across several genres. The company has nine of the top 100 grossing mobile games in the U.S., including several that are the top grossing in their genre. Playtika has more top 100 grossing games than any other company.

The company has years of experience in the market and has kept loyal customers over the years. Half of its revenue in the most recent quarter came from users who downloaded their first Playtika game in 2016 or earlier.

Playtika's most popular game “Bingo Blitz” has grown its revenue by 410% since 2016 and its daily playing users by over 300%.

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Growth Ahead: Playtika has grown through acquisitions. The company acquired “Solitaire Grand Harvest” and has grown revenue by 146% since the acquisition in 2019. “June’s Journey” was acquired in 2018 and its revenue has grown 148% with Playtika.

Mobile games are the fastest-growing segment of video games with 2.5 billion users spending time and money on mobile games in 2019, according to Newzoo. Mobile game revenue is projected to go from $86.3 billion in 2020 to $114.4 billion in 2023.

Plans for future growth include converting non-paying users into paid users, increasing monetization of paying users, pursuing additional acquisitions, launching new games, growing the user base and increasing international revenue.

Daily paying users were 2.1% in 2019 and grew to 2.5% through the first nine months of 2020.

The company gets 76.6% of revenue from North American customers and 13% from customers in Europe.

Financials: Playtika had revenue of $1.15 billion, $1.49 billion and $1.89 billion for the fiscal years 2017, 2018 and 2019 respectively.

Revenue for the first nine months of 2020 was $1.80 billion compared to $1.4 billion in the prior year’s comparable period.