Is mobile game dev profitable? [+Income Report]

I enjoy ranting and talking about the state of the mobile gaming industry. I’ve been covering it for quite a while on this blog. We talked about how much money the average mobile game makes. We talked about the absurd amount of money people spend on mobile games. I even opened up about the reason why mobile game developers rely on fake ads. But we never talked about how profitable mobile game dev is. Especially for solo or small developers. So, is mobile game dev profitable?

Your Answer Upfront:

Mobile Game Development is extremely profitable and you can earn thousands and thousands of dollars in profit. As a solo or small developer you’ll have to hustle and focus not just on making and releasing your own games, but also picking up freelancing and consultancy in order to stay afloat until you can afford to do marketing and user acquisition for your own titles.

My own mobile game development income averages at around $4000/month with 50% of the revenue coming from consultancy, 37.5% from freelancing work and the remainder being revenue from a handful of indie games that I do no user acquisition or marketing for.

In this article we’ll take a look at the profitability of making mobile games. We’ll start talking about my experience first as a indie game developer and as a freelancer and/or consultant. Then we’re going to do a double take and look at statistics and data provided by other developers on the web. By the end of the article you should have a pretty good idea if mobile game dev is profitable.

My current earnings as a mobile game developer

I disclosed my earnings as a mobile game developer on this blog before in the article titled “Why Do People Spend So Much Money On Mobile Games” where I mentioned that on a good month I can earn up to $7000 across all of my mobile game development hustles. This includes my own games, royalties from games I worked on and from consulting and freelancing projects. Notice that I say that’s on a good month.

Over the past two and a half years I’ve had months where I would earn as low as $300 and as high as $15000 from game development, though those $15000 in revenue numbers were skewed by a Steam game release I did and it only happened once. But this comes to show just how much of a spectrum of income and revenue there is.

So before I start breaking down my current revenue let us talk about my living situation and my employment history. After that we’ll talk about the steps I need to take to ensure I won’t go bankrupt in the future and why I need to do to stay profitable.

My Living Expenses ($)

I’m currently living in a low cost country (Romania), in the capital (Bucharest). Even though it’s a low cost country the rent prices are pretty average in the capital as far as Europe rent goes.

My monthly living cost for a 3 bedroom apartment is around 600 Euro (~$650). I also pay around 300 Euro on electricity, internet, heating (gas) and water. So that’s about $1000 on living expenses.

I also spend about $600 on groceries + living supply for two people. Transportation averages at around $200 (Uber + public transportation) per month and I pay about $400 on a mortgage and debts for an apartment I own in another city, but I don’t live in, that I bought a few years ago and I’m still paying off.

All in all my cost of living nowadays is $1000 (Rent + expenses) + $1200 (groceries, transportation, mortgage) = $2200.

My Business Expenses

I try to keep my business expenses as low as possible and have very little recurring expenses month over month. My accountant costs me about $100/month to handle my taxes and income and sometimes I add an additional $100-$200 for special situations (like paying a notary to re-empower them or deliver documents to the tax administration).

I don’t have any costs for the software I use as I’m mostly using Open Source or Free Software to do my work. The only notable exception is Unity 3D as an engine where I pay $150/month on a Pro Subscription.

I also have a work office that I’m renting together with some friends and developers with whom I share a common client, but the client offered to pay for that space for as long as we’re working with him. But I do contribute to things needed in the office like coffee or treats but that amounts to less than $100 monthly.

All in all my business expenses are around $400/month.

My Income from Mobile Game Development

In order for mobile game development to be profitable for me, I need to make more money each month that I spend. To actually have it be profitable I also need to be able to put some money aside for the months where I get no income or revenue from it (no projects/consultancy gigs or any other situation where my revenue is 0). In short I need to earn more than $2600/month from mobile game development. Do I?

Like I mentioned at the beginning of the article, there are months where I can earn as high as $7000. In that case, after taxes, I’m left with about $2000 in profit which allows me to put aside about $1000 for rainy days.

In the months when I make $1500 (the lowest I’ve earned in the past year) I have to take money from savings in order to supplement my cost of living. So far, this year has been really good to me and I’m averaging around ~$4000/month. It’s enough to cover my expenses and be able to put aside a bit of money for the rainy days.

So is mobile game development profitable for me? In most cases it is and it allows me to live a pretty good lifestyle. I could completely reduce my cost of living and move to less decent accommodation and save about 50% on my rent while only using public transportation to cut off about $150 from my transportation bill.

however

We need to take a look at just how profitable it is and at the realities hidden behind the breakdown of my average monthly income. What part of my mobile game dev career actually earns me enough money to make it profitable?

Monthly Income Report Breakdown ($)

Consulting is a really big chunk of my monthly revenue. Most of my consulting gigs are in the Game Design space where I help bring other’s people’s vision to life by designing their games. I talked about this topic in a recent article titled “What does a game designer actually do?“.

Sometimes my consulting jobs are just me coming up with an idea for a game’s re-skin for a few hypercasual game publishers. What this means is they release a game on the market, the game fails due to high CPI and Advertising Costs and they ask me to “capture lightning” and help them re-skin the game to try again. If you’re curious about “Hypercasual Games” or why “Do Mobile Games Fail?” I once again have you covered with articles I wrote on this topic.

Freelancing is the next big chunk of my revenue measuring about 37.5%. All my freelancing gigs are programming gigs where I sit down and develop (design, program) or port games for various clients. 98% of my ports or projects are Unity-based projects and if you’re curious “Why so many games use Unity?” well, once again, I wrote about that topic a few months ago! All my articles on this blog are based on my own first hand experience as a mobile game developer in this industry.

My own indie games? They make less than 10% of my revenue, as funny as that sounds. Truth be told it’s pretty hard to make a mobile games that brings in a ton of monthly revenue, in a market as competitive as this one, without having to pump up constant cash in User Acquisition and Marketing.

Income from indie mobile games with no marketing are pretty low

A few months ago I talked about “How much money does the average mobile game make?” and mentioned that you can expect to make about “$1 for every 4 users has“. So how come I’m making just $300 / month from my games? Do my games have only 1200 users?

That number I gave is pretty accurate. If I check the stats across my active games I end up with around 1000-2000 monthly active users. All my games are using advertisement and a few of them have In-App Purchases to unlock additional content (some levels) and get rid of advertisements. Most of the income comes from advertisements though.

And this is the reality of making mobile games. If you don’t have tens of thousands of users you won’t be making enough money to live a comfortable life. And in order to get a ton of users you need to spend money on User Acquisition and Marketing. In the article “How Do Mobile Games Get Popular” I talked about this subject and I’ll try to sum it up fast.

You need to spend money on marketing to bring new users in. If the money you spend on marketing to bring 1 user in is less than the amount of money you make from that user you end up in a profitable and scalable situation.

Let’s say it costs me $0.2 to bring 1 user into the game. I can spend $2000 to acquire 10 000 users. If I display enough ads in the game while also keeping them for about a week in the game I can earn around $0.25-$0.30 from that user. This would bring me a revenue of about $3000. Minus the initial marketing expense? That’s $1000 in revenue. But that’s if I can keep them playing the game for a week and if my User Acquisition cost is lower than my average revenue per user.

What would it take to quit consulting and just focus on making new mobile games?

In order to get rid of my consulting gigs and just focus on making new mobile games I would need to earn about $2300 from my mobile games, after expenses. That would mean that I would have to spend about $5000 in user acquisition every month.

However it’s not a guarantee that all my user acquisition and marketing campaigns are going to work and dropping $5000 every month isn’t sustainable for me at this point. AKA I cannot afford to do this and run the risk of it not working.

So what can I do?

I can put enough money aside every month until I end up with enough savings that would allow me to risk not having to do any consulting (or freelancing) work for about 1 year. That means I would have to save $5000 X 12 months = $60 000. But I also have living expenses that need to be covered in that period while keeping the $5000 budget intact for marketing and UA.

The adjusted calculation for this ends up at ( $5000 (marketing budget) + $2600 (cost of living) ) X 12 = $91 200.

These savings should be able to last me for 1 year of doing LiveOPS and content for a mobile game with the hope that the game will be successful enough to grow organically. Even if the game ends up featured by Google and Apple, that doesn’t mean the marketing and UA campaigns are going to be stopped, just decreased for a while. And then I’d have to pump money into it again.

So that’s why I focus more on consulting and freelancing than making my own games. It’s easier and less costly to be just as profitable from consulting/freelancing work than you can be from making your own indie mobile games. However, the bigger the budget you have the easier it is.

There is such a thing as a bigger ROI as you spend more money with the average UA cost decreasing the more you spend. But for that to be felt you really need to spend 10-20x my aforementioned budget at least.

Can you make money from making mobile games?

You can earn a lot of money from making and releasing mobile games. In order to do that you should be able to spend at least 2-3 times your desired monthly income from the game on user acquisition and marketing in order to be able to bring new users into the game so you can monetize them at a rate of ~$1 every 4 users, on average. If your user acquisition cost is lower than your average revenue per user, you can make quite a decent sum of money once you scale!

Make sure to check out my other article on “How much money does the average mobile game make?“. And please make sure you know the risks when it comes to doing so. Success as an indie game developer rarely happens and it’s even rarer in the mobile gaming industry. Always make sure you can afford a failure.

In 2017 I tried releasing an indie game that I assumed was going to succeed and I almost went bankrupt. There’s an article on GameDeveloper.com about that failed launch. I ended up being lucky and manage to recover from that failure (and even made quite a bit of profit from the game in the end), but don’t assume that’s always the case.

Is mobile game dev profitable?

Mobile Game Development is extremely profitable and you can earn thousands and thousands of dollars in profit. As a solo or small developer you’ll have to hustle and focus not just on making and releasing your own games, but also picking up freelancing and consultancy in order to stay afloat until you can afford to do marketing and user acquisition for your own titles.

If you can find ways to reduce your marketing costs you’ll have a much easier time on your hand. Take this blog as an example. There are a few reasons why I started this blog and my goals with it are to:

• Inform users about the current state of the mobile gaming industry
• Teach new developers about the realities of making mobile games
• Help indie and mobile game developers by featuring and bringing traffic to their games

The last bullet point? I’m also in that category. If I can grow this blog to about 50-100000 monthly organic visitors I can redirect part of that traffic to my own games on the App Store or Google Play. A 1% conversion rate would mean that between 5 and 10000 eyes sent to my game with $0 on user acquisition.

So, if you ever wondered why I write so many informational articles and cover so many topics, you have part of the reason. I’m hoping to establish a decent fan base of loyal readers and users and, in exchange for the information in this article, I can get some more eyes on my projects.

You have to grind and be creative in this industry. It’s an extremely ruthless industry and it requires a ton of work to succeed. But if you do succeed, expect all the work put in to be worth it.

How much money does a mobile game developer make

A mobile game developer that’s employed as part of a company in the United States makes around $81,175 per year according to Salary.com with $71K on the low end of the spectrum. After taxes the mobile game developer will be left with $59,421 after paying $21,579 in taxes.

So, if you think about it, by running my own business, doing consultancy and freelancing and releasing my own games, I earn about as much as an average mobile game developer does as an employee in the US (after taxes). However, I have the added bonus of living in a low cost country.

Where To Next?

I write extensively about the mobile gaming industry, their tactics and how greed influences a game’s design, subjects which were brought up in this post. 

I believe that you might be interested in more articles on game monetization. So if you want to stick around, you can check out “How Do Free Mobile Games Make money“, “Why Do Mobile Games Have Fake Ads” and “Why Do Mobile Games Have In-App Purchases“. 

There’s also a monster post (about 4000 words) that answers the question: “How Hard Is It To Make A Mobile Game“. It goes in depth with actual examples on how Experience, Resources and Financials affect the difficulty of developing and releasing new mobile games!

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