Smaller subscription deals and the underperformance of certain titles have had a severe impact on Devolver and TinyBuild, says stockbroking firm Goodbody.
Both companies floated at the peak of the games business in 2021 and have seen their share prices plummet over the past two years. Devolver has seen its share price drop 92% since its peak in January 2022, while TinyBuild's has fallen 95%
"We have seen from Devolver and TinyBuild that subscription is under pressure at the moment," says Patrick O'Donnell, technology and video gaming analyst at Goodbody.
"The cheques coming from Sony and Microsoft are just not as big as they were. And that creates problems if you're concentrated on that side of the market.
"TinyBuild, of all of them, was most exposed. Devolver was exposed, but not quite as much."
As for game subscriptions, I've not looked into it much, but I know Apple's service at least is based on hours played, which has resulted in some games on the service attempting to stretch out their playtime using things like mandatory grinding to progress in their games. With this model, developers can literally shoot themselves in the foot financially, by allowing the player to sprint. It's stupid.
Games can't be reduced to that simple a value. You can get the same amount of hours out of God of War as you can Binding of Isaac, but their production and purchase costs, are not, and should not, be the same.