Shares in Glu Mobile, the video-game publisher that surged after its "Kim Kardashian: Hollywood" became a hit, fell on concern that the title may be losing some of its appeal.
Glu, based in San Francisco, dropped as much as 9%, the most in more than two months, after the Kardashian game fell in online rankings. In the past month, the title fell to No. 162 in the rankings among iPhone downloads from about No. 89, according to researcher App Annie. On the Apple format, it stands at No. 7 today among top grossing titles, after reaching the top 5 after its release in June.
"If the download rank has fallen significantly, people may be assuming that revenues for the game have at least hit a trough if not peaked," said Lewis Ward, research director of gaming at International Data Corporation. He said the game this year has been a success for Glu, and revenue per user is more important than the number of people playing.
A Glu official didn't immediately respond to a request for comment. The website TheStreetSweeper reported on declining downloads earlier today, citing App Annie.
The game takes users on a virtual tour through Hollywood with advice from the celebrity on how to reach the A-list.
Through yesterday, Glu shares had risen 32% for the year.
Mike Hickey, an analyst with Benchmark Co., said he is less concerned about the volume of downloads. Glu said on Oct. 2 that it added new content for the game and made it available to Facebook users.
"The investor perception is mobile games are one-hit wonders," said Mr. Hickey, who rates the stock neutral. "The concern would be for growth in 2015."
Publishers of casual games have enjoyed big highs when their titles become hits, but have sometimes struggled to maintain growth or find a successful sequel. Rovio, the maker of "Angry Birds," said last week that it plans to eliminate 130 jobs, or 16% of its workforce.
~ Bloomberg News ~