Netflix announced Wednesday that it plans to acquire Finland-based mobile game developer and publisher Next Games for about $72 million.
The deal, which is expected to close in the second quarter, is part of the streaming service’s strategy to increase its investment in mobile gaming and increase the ways it can reach consumers through its storytelling.
“We are excited for Next Games to join Netflix as a core studio in a strategic region and key talent market, expanding our internal game studio capabilities,” said Michael Verdu, Netflix’s vice president of games in a statement. “While we’re just getting started in games, I am confident that together with Next Games we will be able to build a portfolio of world class games that will delight our members around the world.”
Next Games had about 120 employees at the end of 2021. Sales were about $30.17 million in 2020, with 95% of revenue coming from in-game purchases.
The company had projected it would generate at least $44.4 million in 2021.
Founded in 2013, Next Games has developed games based on popular TV shows including “The Walking Dead.” Last year, it released a mobile game called “Stranger Things: Puzzle Tales,” based on Netflix’s popular sci-fi franchise “Stranger Things.”
“Joining forces with the world’s largest streaming service, Netflix, presents an opportunity for a logical and exciting continuation of our strategy to craft interactive experiences for the world to enjoy,” said Teemu Huuhtanen, Next Games’ CEO.
“Our close collaboration with Netflix on Stranger Things: Puzzle Tales has already proven that together we create a strong partnership. This is a unique opportunity to level-up the studio on all fronts and continue on our mission together.”
Netflix launched its mobile games in November, and executives have discussed plans to deepen its investment in the space. In September, Netflix purchased Glendale-based Night School Studio for an undisclosed price.
Gaming is a popular way for younger consumers to entertain themselves. Last year Deloitte released a survey showing that 26% of Gen Z (people born between 1997 and 2007) listed video games as their top entertainment choice, compared to 10% who preferred watching a movie or TV program at home.
Netflix stock was trading at $376.77 a share, down about 3%, on Wednesday.