Why KING is getting Candy Crush'ed

The Street's Debra Borchardt reveals why investors have little appetite for Candy Crush.
3:00 | 03/27/14

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Transcript for Why KING is getting Candy Crush'ed
We'll shares of king are getting -- the candy crash maker's stock now down close to 20% after debuting yesterday morning for the first time. So wary investors sour on this wildly popular -- we want to welcome Deborah Borchardt she -- markets analyst. For this street and Everett so nice to see you don't thank you for having me -- is really a surprise I don't think there was a person out there at least not one that I read about who was saying this is. I huge IPO it's going to be great river every homeless really excited about it because we -- candy -- in some of us are addicted to the game. But if you really look at the numbers you saw that going from September to December at the numbers were coming down and -- there was a big -- here. That -- with going to be a one hit wonder with candy crash. Right because there's of the company it's a UK. Maker of games. The biggest one is candy crash candy -- did very well but like all games on the Internet everybody gets really hot on something for awhile they move on to the next big fat. And if you're the maker of games you gotta keep churning out those bats in order to meet profitable well that's correct everyone remembers we were hooked on Angry Birds and -- was being of people -- -- on farm bill. And so there's a real worried that this will be a one hit wonder that they're not going to be able to get people onto. The next game. What does -- say eighty you about technology. To see and I peel like -- come out you know the fact that there was investor interest. Prior to it being public in owning this company. Facebook's out making multi billion dollar acquisitions what feels like on a daily business. Everybody has been calling this based. Frothy they've been calling in a bubble now for a handful of years but do you feel like we've actually gotten to the point where it we could see it tipping point. I I don't because I think that this is specific to this company we just had coupons dot com go public a couple weeks ago and they're up 63%. So people look at coupons dot comment that you know. This is a good model they're making money I know what I think they're going to be sticking around. We're seeing here is just so much uncertainty as to whether people are going to. Step up and buy that next gate I expect we're going to be bombarded with advertising for that next game all the money they just made on its IPO. Right he absolutely advertising for that -- -- which is an interesting part of how all of these companies online are making their money it's primarily. Through advertising. You know so many of them are having -- Like Google for example trying to look for other alternatives to making money on the Internet but advertising is really king at the end of the day. At the same time. 36% of Internet traffic is -- it's -- it's these bots that people are talking about these games they also make them all that called micro transactions though you the booster in deafening and -- are well. I mean I I I I I liked honor and I sent that up. But again wouldn't you looked at the numbers for king -- that those players spending money were coming down. From September to December and that just made everyone very nervous I'm not sure how much you could hear of the last segment but we were talking to this app maker -- -- Which is an app that lets moms listen to their child's heart their unborn child's heart -- Just app economy -- you mean you you -- -- you look at it but the the growth here -- there are no barriers to entry she actually at a really good space right now because. Health and fitness and medical tech is booming and there are so many neat and cool things like what she's doing that are coming on the market right now. That it is a hot place to be right now is medical health fitness -- Gaming and gaming going a little iffy and I think that that's what this market is shown. Everybody believes king should've gone public last year they should have piled Long -- being went public before exiting showed us that they were of one at wondered that would have been. Much better timing now. Zynga the maker for those who don't know the maker of farm bill which was really hot at what moment in time as well. So hot today right it was huge on that -- huge on Facebook and people went to playing games on their phones and not electronic -- up. And that's where they went wrong whatever we really appreciate you joining us thanks so much for being with us on real events thank you. And -- you for joining us on really is we might hear from you what do you think about -- would you be into that app that lets you listen to your unborn baby's heartbeat. Tweet -- that real visit -- today don't -- that this is Rebecca Jarvis from New York have a great --

This transcript has been automatically generated and may not be 100% accurate.

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