The Playside Studios Ltd (ASX: PLY) share price is surging higher today on the back of the company's quarterly activities and cash flow report, which included an update on its recent acquisition.
Over the first quarter of financial year 2022, Playside received a record $4.04 million of revenue and signed an agreement to launch its maiden PC game.
At the time of writing, the Playside share price is 67.5 cents, 16.38% higher than its previous close.
However, earlier this morning, the company's stock reached a new 52-week high of 70 cents, representing a daily gain of 20.6%.
Let's take a closer look at today's news from the video game developer.
The quarter just been for Playside
The Playside share price is soaring after it announced its Original IP business had its best quarter since the company's inception.
Over the 3 months ended 30 September, its Original IP business saw $2.7 million of revenue. That represents a 22% quarter-on-quarter increase and 227% more revenue than it reported for the same quarter of the last financial year.
The business also signed a strategic partnership with London-listed, 5-time BAFTA award winning publisher, Team17. Together, the companies will publish Playside's PC title, Age of Darkness: Final Stand.
Under the partnership, Team17 will provide Playside with $2.42 million of recoupable payments to fund the title's development in exchange for publishing rights. The companies will share the title's future profits.
The company's work for hire business also saw an increase in revenue over the quarter just been. It brought in $1.33 million, a 46% quarter-on-quarter increase and 25% more than the prior corresponding period's revenue.
The business' key achievement was the extension and expansion of its agreement with Facebook Inc's (NASDAQ: FB) Facebook Technologies.
Playside's latest work-for-hire development agreement with Facebook Technologies saw the contract's value boosted 90% higher than that of its previous agreement.
The contract was extended for another 6 months. In that time, PlaySide will deliver between 10 and 16 mini games.
Additionally, the titles launched by Playside in financial year 2021 and during the first quarter of financial year 2022 are all performing well.
The company also has 5 titles expected to launch this financial year, including a new title for the Dumb Ways to Die franchise.
Dumb Ways to Die update
The Playside share price is likely also being boosted by news of its first acquisition. The company acquired the Dumb Ways to Die franchise in September, paying for it on 1 October.
The franchise was purchased from Metro Trains Melbourne. Metro Trains Melbourne birthed Dumb Ways to Die after a 2012 campaign to promote rail safety went viral.
The franchise includes 6 'freemium' mobile titles, merchandise, trademarks, social media accounts, and other digital assets. Freemium titles are free to access but offer in-game purchases.
According to Playside, the $2.25 million purchase price represents 1.5 times the franchise's financial year 2021 revenue.
Since the acquisition, Playside has published several videos to the franchise's TikTok account. The videos have amassed more than 7.8 million views and brought more than 330,000 new followers, growing the account's following by 57% and boosting the games' revenues.
Playside is currently in the pre-production phase for the development of a new title for the franchise. The company plans to release the title in the fourth quarter of financial year 2022.
Playside share price snapshot
Since Playside's initial public offering (IPO), which occurred in December 2020, the company's share price has gained 114%.
It is also currently 237% higher than the company's prospectus offer price of 20 cents.
