What are the 10 Biggest Video Game Companies in the World in 2018? Read on to find out.
Video games can be fun. They can be addictive. They can also be profitable for shareholders. Unlike Hollywood, video game makers don’t have to contend with paying stars exorbitant salaries. Programming talent is also a lot cheaper than top acting talent. For many social games, advertising costs can also be low due to the viral nature of friends inviting other friends to play.
When done correctly, a new video game can launch a franchise that produces enjoyment for users and profit for investors for decades.Some games, such as Madden Football have had over 20 different iterations and have been around for decades. Others, like Grand Theft Auto, can be as big as any movie franchise that comes out from Hollywood. In terms of specific numbers, ‘Grand Theft Auto 5’ has brought in $6 billion in sales since it was released in 2013, versus Hollywood’s biggest single grossing film, ‘Gone With the Wind’, which when factoring inflation, has grosses only $3.4 billion in box office receipts. Some video games can cross over and launch movie themselves, such as Tomb Raider or Prince of Persia, and create additional licensing revenue for video game producers.
Demand for video games has been strong. Due to the fact that billions of people have smartphones or PCs and almost everyone enjoys entertainment now and then, the market for video games is large. The biggest pure gaming companies regularly ring up tens of millions of titles and billions of dollars in sales every year. The future seems promising for video game producers too. With more and more people buying smartphones, PCs, Laptops, and gaming consoles each day, demand for video games will likely continue to increase. With upcoming virtual reality and augmented reality technology, video game producers could potentially realize even more demand.
Needless to say, a large market and an addictive product can translate into major earnings power for the companies that make them. Given these conditions, let’s go over the 10 Biggest Video Game Companies in the World in 2018. As a note to our methodology, we use a flexible system due to the fact that some major companies, such as Microsoft Corporation (NASDAQ:MSFT), and TENCENT HOLDING/ADR (OTCMKTS: TCEHY), may make games and other things. Others, like TAKE-TWO INTERACTIVE SOFTWARE, INC Common Stock (NASDAQ:TTWO), Electronic Arts Inc. (NASDAQ:EA), and Activision Blizzard, Inc. (NASDAQ:ATVI) are more pure video game based. Some data is private and requires estimates, and others are publicly available. Our list is not based on revenue alone, but it incorporates a number of different factors.
Although not well known in the West, Netmarble, a Korean game publisher is big in Asia. The company is the number one online game publisher in Korea, and reported sales of $519.4 million for Q3, up 62% year-over-year. According to its press release, Netmarble is also one of the fastest growing mobile game companies in Asia. The company is known for hits such as Star Wars: Force Arena, which features many Star Wars characters and has been played by over 6.5 million people globally.
#9 TAKE-TWO INTERACTIVE SOFTWARE, INC Common Stock (NASDAQ:TTWO)
Number nine on our list of the 10 Biggest Video Game Companies in the World in 2018 is TAKE-TWO INTERACTIVE SOFTWARE, INC Common Stock (NASDAQ:TTWO). Take Two is perhaps best known for the Grand Theft Auto franchise, which is arguably the biggest gaming franchise of all time. Sales of Grand Theft Auto 5 have numbered over 90 million units and have brought in $6 billion in total revenue. Although Grand Theft Auto has driven sales, TAKE-TWO INTERACTIVE SOFTWARE, INC Common Stock (NASDAQ:TTWO) also has a number of other franchises including Sid Meier’s Civilization that has helped its stock soar over the past five years. The company reports its fourth quarter earnings result of May 16, 2018. Take Two reported $653 million in sales for Q3.
Ubisoft, as the publisher of Far Cray and Assassin’s Creed: Origins, reported strong results for its third quarter. The French game maker reported revenues of 725 million euros, or $889.4 million, for the three months ended December 31. Ubisoft’s results were better than its previous guidance of around 700 million euros and good for eighth place on our list of 10 Biggest Video Game Companies in the World in 2018.
#7 NetEase Inc (ADR) (NASDAQ: NTES)
Although it’s relatively new versus some other companies on our list, Chinese tech company NetEase Inc (ADR) (NASDAQ: NTES) is one of the world’s largest video game makers. Founded in 2001, NetEase Inc (ADR) (NASDAQ: NTES) has published games such as Fantasy Westward Journey, as well as local adaptations to some Western games. The company has a strong mobile presence, and reported revenue of $1.88 billion for Q3, up 35.3% year-over-year. Not to be outdone, NetEase reported $2.2 billion in sales for Q4.
#6 Activision Blizzard, Inc. (NASDAQ:ATVI)
Activision Blizzard, Inc. (NASDAQ:ATVI)’s greatest hits include World of Warcraft, the massively multiplayer game that has been addictive to millions of people, and Call of Duty, a live action game that looks more and more realistic every year. Due to strong demand, Activision Blizzard, Inc. (NASDAQ:ATVI) reported revenues of $1.9 billion for Q3, and $2.64 billion for Q4, both of which are better than expected numbers.
Although the Pokemon Go craze isn’t as strong as it once was, Nintendo is still one of the largest gaming companies in the world. The company reported sales of 489.1 billion yen for 2017, or roughly $4.48 billion. Although it may not be as big as some of the other companies on our list, Nintendo has an out-sized impact in gaming due to its venerable franchises such as Super Mario Bros and Pokemon (as part publisher), which have generated billions of hours of entertainment. Due in part to Nintendo Switch, sales of video games in general have increased over the past two years.
#4 Electronic Arts Inc. (NASDAQ:EA)
Electronic Arts Inc. (NASDAQ:EA) sports make iconic sports games such as Madden NFL, which has been around for more than two decades, and FiFA18, which is a major hit in soccer rabid countries. Electronic Arts Inc. (NASDAQ:EA) is also known for other sport games. For its third quarter, EA reported revenue of $1.97 billion, making it one of the biggest video game companies in the world.
Given the ubiquity of the Playstation gaming system, it’s not surprising that Sony would be a major video game maker as well. Although Sony is more well known for its TVs and other electronic gadgets, the Japanese conglomerate owns many media properties and tries to realize synergies by tying the media properties together. One synergy would be to make games for its Playstation platform, which is one of the leading game consoles in the world. Sony reported $68 billion in sales for 2017.
#2 Microsoft Corporation (NASDAQ:MSFT)
As a major enterprise software conglomerate, Microsoft Corporation (NASDAQ:MSFT) is mostly known for other products such as Windows or Office. Thanks to its XBox division, however, Microsoft Corporation (NASDAQ:MSFT), is also a major gaming producer. Microsoft has made popular titles such as Halo and has acquired companies that make games, including the publisher of Minecraft. Microsoft has also produced perhaps the most iconic game of all, solitaire.
#1 TENCENT HOLDING/ADR (OTCMKTS: TCEHY)
Although it may not have as much revenue as Microsoft, TENCENT HOLDING/ADR (OTCMKTS: TCEHY) is arguably the world’s largest gaming corporation due to its stronger focus in that segment. Hundreds of millions of Chinese play video games through mini programs on Tencent’s WeChat app, and the company also publishes smash hits such as Honor of Kings, which was played by around 200 million people in late 2017. In addition, Tencent also owns pieces of other gaming companies such as Ubisoft, Riot, Activision, and others. Due to its strong gaming revenues as well as strong social apps, TENCENT HOLDING/ADR (OTCMKTS: TCEHY) shares have done very well over the past five years.