Rovio Entertainment Interim Report January–March 2020

Kati Levoranta, CEO René Lindell, CFO April 28, 2020 To ask your Today’s speakers question Dial:

FI: +358 981 710 310 SE: +46 856 642 651 UK: +44 333 300 08 04 US: +1 855 857 06 86

PIN: 76415854# Kati Levoranta Rene Lindell CEO CFO

2 First Quarter of 2020 in an Eggshell Improved profitability, cash flow and the performance of Angry Birds 2

• Adjusted EBIT margin was 19.6%. Profitability was impacted by a low level of user acquisition (UA) and stable key games performance, most notably Angry Birds 2 • Operating cash flow increased y-o-y to EUR 11.5m (3.3) • Group revenue was EUR 66.6m, decreased 6.0% y-o-y. • Games revenue EUR 62.7m, Brand Licensing EUR 3.9m • UA investment were 21.5% of Games revenues. • Exciting game roadmap: altogether 10 new games in development, of which 3 are in soft launch • Angry Birds long-form animated series announced with Netflix scheduled for release in 2021 • Hatch completed restructuring of operations as planned. The restructuring is estimated to result in annualized cost savings of approximately EUR 6 million effective from June 2020 onwards.

3 Q120: Rovio Group revenue declined by 6.0%

Revenue (EUR million)

• Group Q120 revenue declined 6.0% to EUR -6.0% 66.6m (70.9) 70.9 66.6 4.6 3.9 • Games revenue declined 5.3% to EUR 62.7m (66.3) • Angry Birds 2 gross bookings declined vs. Q119 but were at a stable level compared to three 66.3 previous quarters 62.7 • Angry Birds Dream Blast revenue declined vs. Q419 due to lower level of UA. Sugar Blast gross bookings marginally increased vs. Q419. • Brand Licensing declined 15.9% y-o-y to EUR Jan-Mar 19 Jan-Mar 20 3.9m (4.6) due to lower revenues from The Brand Licensing Angry Birds Movie as expected. Games

4 Q120: Improved profit margin due to stability of key games despite lower user acquisition

Adjusted operating profit (*) Adjusted operating profit • Group adjusted operating profit was EUR (EUR million) Margin (*) 13.0m (7.5), and adjusted operating profit 19.6% margin was 19.6% (10.5%) 13.0 0.8 • Key drivers of the improvement in 7.5 10.5% profitability were strong performance in 0.6 Angry Birds 2 and the decrease in UA 16.6 investments. 10.1 • Games adjusted operating profit increased -3.3 to EUR 16.6m (10.1) y-o-y -4.4

• Brand Licensing unit adjusted operating Jan-Mar 19 Jan-Mar 20 Jan-Mar 19 Jan-Mar 20 profit increased to EUR 0.8m (0.6)

Other BLU Games (*) The adjustments during the Jan-Mar 2020 period amounted to EUR 0.3 million and were related to the restructuring of Brand Licensing and Hatch Entertainment. There 5 were no adjustments in the Jan-Mar 2019 period. Q120: Games gross bookings declined 5.7% y-o-y Games gross bookings (EUR million) 67.0 • Games gross bookings EUR 62.1m 65.8 65.2 65.1 62.1 (65.8) and 5.7% y-o-y growth; declined approximately 8% in comparable currencies 24.9 26.5 25.0 32.0 25.0 • Angry Birds Dream Blast grew y-o-y, but declined q-o-q as a result of reduced UA investments AB 2 14.0 18.8 6.9 17.8 AB Dream Blast • Angry Birds 2 grew marginally q-o-q. 16.1 AB Friends The game performance improved 7.2 6.6 5.9 AB Match on the back of new updates 6.2 5.6 6.8 6.6 5.3 AB Pop 5.7 4.4 • Sugar Blast gross bookings were 3.3 3.0 2.7 Sugar Blast 2.7 2.2 2.6 EUR 2.3m in Q120. Working to 0.5 2.3 Other games 9.7 8.5 improve scalability. 7.3 7.3 6.1 1Q19 2Q19 3Q19 4Q19 1Q20

6 Angry Birds 2 (Earn) was the highlight of Q1

Games gross bookings (EUR million)

65.8 65.2 65.1 67.0 62.1 6,9 § Sugar Blast Grow 14,0 18,3 21,0 § Angry Birds Dream Blast Earn 18,4 § + games in soft launch Catalogue

§ Angry Birds 2 49,3 § Angry Birds Match 42,7 § Angry Birds Friends 39,6 38,8 37,6 § Angry Birds Pop

§ +other games 9,7 8,5 7,3 7,3 6,1 Q1/19 Q2/19 Q3/19 Q4/19 Q1/20

7 Q120: Lower level of user acquisition investments

• Q120 UA investments were EUR User acquisition investments User acquisition investments, % of games revenue 13.5m (23.7) or 21.5% (35.8%) of (EUR million) 27.5 games revenue 27.1 50 23.3 23.7 41.3 • The largest reduction of UA took 22.9 40.8 21.3 40 35.7 place in Angry Birds Dream Blast 35.1 32.6 17.8 • Significant proportion of UA for 30 35.8 13.5 the “Grow” – category of games 28.2 20 21.5 • Angry Birds 2 received less UA vs. Q419 (and significantly less vs. 10 Q119) 0 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120

8 Q119-Q120 UA split (%) per games category

• 66.2% was allocated to “Grow” category games Angry Birds Dream Blast and Sugar Blast. 49.2 70.8 70.3 • 33.6% of UA to “Earn” category, 76.8 66.2 mainly to Angry Birds 2 Grow Earn • Catalogue games did not receive Catalogue any significant UA investments 48.7

28.4 29.7 23.1 33.6 2.1 0.7 0.0 0.1 0.2 Q119 Q219 Q319 Q419 Q120

9 Operating cash flow improved Operating cash flow (EUR million) Cash & cash equivalents (EUR million)

19.2 • Operating cash flow was EUR 140 123,6 128,8 127,9 124,7 11.5m in Q120 (3.3) 120 • Cash flow increased significantly 124,6 121.1 y-o-y as a result of improved 107,4 100 97,0 profitability 11.1 11.5 80 • Cash balance at end of Q120 60 EUR 121.1m (end of Q419: EUR 4.8 124.7m) 40 3.3 3.1 • EUR 11.1m cash used to 1.8 20 purchase treasury shares during Q120 0 -0.7 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120

10 No changes to 2020 Outlook

2020 outlook During 2020 we aim to launch 1-3 new games. The timing of new game launches depends on how the games progress in soft launch. Therefore, we do not give a full year 2020 revenue guidance. We start the year at a lower user acquisition level than we ended last year. Due to lower user acquisition investments and the planned cost savings in Hatch Entertainment Oy our adjusted operating profit improves. Basis for outlook • Our long-term strategy is to seek growth in the Games business through improving the performance of our key games and developing new games.

• Brand Licensing segment is optimized for profit at a lower revenue which is expected to decline approximately 50% year-on-year in 2020.

• Hatch Entertainment annualized expenses are expected to be approximately EUR 5 million (2019: EUR 10.9 million) on an adjusted basis after restructuring and aligning with its new strategy.

11 Basis for 2020 outlook per games category

We believe Angry Birds Dream Blast will grow on an annual basis, but starts the year at a lower quarterly run-rate compared to the end of 2019. We have a strong feature roadmap for the game GROW focusing on improvements to long term retention and the marketability of the game. We are devoted to improving Sugar Blast gameplay and introducing new live operations to improve retention and monetization to scale the game up.

The revenues of Angry Birds 2 stabilized despite much lower user acquisition investments y-o-y. We further focus on improving the performance of the game through introducing new updates that increase EARN engagement with our core users. The revenue of other games (Angry Birds Match, Angry Birds Friends and Angry Birds Pop) is expected to continue decline at a steady slow pace. We have lowered or stopped user acquisition investments into these three games.

We expect these games to continue declining over time. They still receive substantial organic CATALOGUE downloads but the active user base and revenues are expected to decline over time and we do not develop these games further.

We aim to launch 1-3 new games in 2020. Currently we have three games in soft launch and several NEW GAMES games in other phases of production.

12 Games roadmap broadened

• We have altogether 10 new games in development, of which 3 are in soft launch: • World Quest (soft launched July 2019) • Small Town Murders (soft launched October 2019) • Phoenix Rangers (soft launched November 2019) • Aiming to launch at least 1-3 new games during 2020, timing always dependent on game KPIs and the scalability of user acquisition • Small Town Murders scheduled for launch in June 2020. • We continue to manage the game development pipeline by adding more new projects to the beginning of the funnel and assessing the potential in existing projects • Angry Birds Pop Blast discontinued in January.

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Phoenix rangers pic To ask your question

Dial:

FI: +358 981 710 310 SE: +46 856 642 651 UK: +44 333 300 08 04 US: +1 855 857 06 86

PIN: 76415854# Kati Levoranta Rene Lindell CEO CFO

17 Q&A Appendix Lower UA reflected in DAU and MUP during Q1

• Daily active users (DAU) in DAU (Daily Active User), MUP (Monthly unique Payers) millions thousands Q120 for top games was 10 600 3.7 million. 581 8,8 517 504 495 489 497 • 8 8,0 460 454 Monthly unique payers 7,0 7,0 497 426 (MUP) for top 5 games 6,6 5,9 400 451 444 428 5,9 422 393 was 393 thousand. 6 5,4 394 4,0 3,8 4,1 • Lower UA and seasonally 4 3,8 3,5 3,5 3,4 3,7 weaker Q1 vs. Q4 are two 200 key drivers explaining the 2 drop in these metrics. 0 0 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120

Top 5 games All games

20 Monetization has remained stable q-o-q ARPDAU (Average Revenue Per MARPPU (Monthly Average • ARPDAU for all games Daily Active User), EUR Revenue per Unique Payer), EUR EUR 0.13 0.2 50 0,… 0,18 0,18 0,16 41,5 38,3 39,6 0,16 0,16 38,7 39,0 0,15 0,15 36,0 38,0 • ARPDAU for top 5 games 33,5 EUR 0.16 0,13 0,12 0,12 0.1 0,11 25 0,10 0,10 0,09 • MARPPU for top 5 games 0,08 was EUR 39.6

0.0 0 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19

Top 5 games All games

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