King Digital shares fell as much as over 14% in after hours trading after it warned of weaker profits.
Candy Crush maker said it expects fluctuations in foreign currency and a lack of new releases to hold back its earnings in the current quarter.
The big drop in King Digital (KING) shares came despite the release of first quarter sales figures that beat market expectations.
The company has been struggling to increase market share.
King Digital’s revenue fell 6.1% to $569.5 million in the first three months of the year from a year ago, but that was higher than analysts’ forecasts of $563.4 million.
“We look toward the remainder of the year, we expect the mid-year period to be seasonally softer, returning to growth trends in the latter part of the year,” the company said in a statement on May 14.
The company is launching a new game this year, but that will not be released until the later half of the year.
King Digital said that falls in both gross bookings and revenue in the first quarter were largely due to lower sales from its Candy Crush Saga and other “more mature games” – a sign that players are moving on to other games.
Facebook posted a slower revenue growth in the first quarter of 2015 with a profit of $512 million, down 20% on a year earlier.
Revenue rose 42% to $3.5 billion, a figure slightly below analysts’ forecasts.
A bright spot was the rise in monthly active users, up 13% from a year earlier to 1.44 billion.
Notably, for those investors concerned about the company’s efforts to appeal to younger users who access Facebook on their smartphones, monthly mobile users increased by 24% to 1.25 billion, a majority of the site’s users.
Facebook has been particularly adept at channeling that growing mobile user base into advertising dollars. The company said that during the quarter, revenue from mobile ad sales made up nearly three-quarters of total ad sales.
Investors have been worried about slowing revenue growth, as well as increasing costs at the company. Facebook has been spending more on research and development as it moves beyond its original social networking operation.
Spending on research and development jumped to $566 million from $181 million a year earlier.
Facebook has warned that those costs are set to increase, as it looks to expand some of its acquisitions including photo-sharing site Instagram, messaging service WhatsApp, and virtual reality company Oculus Rift.