Netflix makes €65m play for Stranger Things games developer

2 Mar 2022

Concept art from Stranger Things: Puzzle Tales. Image: Next Games

The popularity of Netflix’s ’80s TV series is feeding into its gaming strategy as it snaps up Next Games, the Finnish game studio behind Stranger Things: Puzzle Tales.

Netflix has entered into an agreement to buy Next Games for a total equity value of about €65m.

Next Games builds mobile games based on well-known franchises including The Walking Dead and Netflix’s own Stranger Things.

Future Human

“Next Games has a seasoned management team, strong track record with mobile games based on entertainment franchises, and solid operational capabilities,” said Netflix VP of games Michael Verdu.

Founded in Helsinki in 2013, Next Games grew to become Finland’s first publicly listed mobile game developer and publisher. The company will now join Netflix as a core studio operating in Finland – “a strategic region and key talent market”, according to Verdu.

Netflix confirmed its plans to expand into gaming after much speculation last summer.

At the time, the company said its strategy would build on earlier efforts around interactivity and the Stranger Things games. Stranger Things: 1984 and Stranger Things 3, developed by BonusXP, were the first games made available to download via the Netflix app when it began a limited launch of its gaming service for Android users in Poland.

On this journey into gaming, the streaming giant has also acquired US video game developer Night School Studio, which was behind a Stranger Things-like mystery adventure game.

“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,” said Verdu.

At the end of 2021, Next Games had a team of 120 and reported sales of about €27.2m in 2020. Its revenue is almost entirely generated by in-game purchases.

In October, the company secured a €3m loan from its largest shareholder to drive sales of its newest release, Stranger Things: Puzzle Tales.

“Our close collaboration with Netflix on Stranger Things: Puzzle Tales has already proven that together we create a strong partnership,” said Next Games CEO Teemu Huuhtanen.

“This is a unique opportunity to level-up the studio on all fronts and continue on our mission together.”

The board of Next Games has already evaluated the deal and is recommending shareholders accept the tender offer to acquire all issued and outstanding shares at a price of €2.10 in cash per share. The deal is expected to close in the second quarter of this year.

Stranger Things, meanwhile, is set to return for its fourth season in May 2022.

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Elaine Burke is the editor of Silicon Republic

editorial@siliconrepublic.com