In this article, we will discuss the 11 Most Profitable Gaming Stocks Now.
Gaming is a multi-billion-dollar industry that has seen explosive growth in recent years. With the rise of online gaming and mobile gaming, the industry has become more accessible than ever before, attracting a wider audience of gamers. As per, PwC’s Global Entertainment and Media Outlook 2022-26, the gaming industry is set to post revenues of $321 billion by 2026, a significant increase from $235.7 billion in 2022.
The COVID-19 pandemic has played a significant role in increasing the growth of the video gaming industry. With more people staying at home, people turned to video gaming as a way to keep boredom at bay and stay connected with others. A global survey conducted in June 2020 revealed that 60% of respondents had increased their frequency of playing multiplayer games during the pandemic. Mobile gaming played is one of the most rapidly growing segments within the gaming industry and is set to grow at a CAGR of 11.2% through 2024 to achieve $116.1 billion in revenues. As per Statista, a staggering 2.65 billion people played mobile games in 2021, out of which 1.29 billion were Asians.
One of the biggest trends in the gaming industry in recent years has been the rise of esports. Esports involve competitive gaming, with professional players and teams competing in tournaments and leagues for large prizes and sponsorships. Esports tournaments and leagues have attracted millions of viewers and participants worldwide, with winning prizes worth millions of dollars. The Global esports market reached $1.38 billion in 2022, with Asia and North America firmly at the top of the eSports revenue leaderboard. Esports has proven to be a lucrative endeavor for individual players, too.
Another trend in the gaming industry has been the rise of virtual reality (VR) and augmented reality (AR) gaming. VR and AR allow players to fully immerse themselves in the gaming experience, creating a more immersive and interactive environment. While VR and AR gaming is still in its early stages, it has the potential to revolutionize the gaming industry. As per Kobe Digital, AR and VR gaming sector is expected to be valued at over $25 billion by 2025.
In terms of revenue, the gaming industry is dominated by a few major players, including companies like Electronic Arts Inc. (NASDAQ:EA), Activision Blizzard, Inc. (NASDAQ:ATVI), and Tencent Holdings Limited (OTC:TCEHY). These companies produce some of the most popular games in the industry, with franchises like Call of Duty, FIFA, and League of Legends bringing in billions of dollars in revenue each year.
Most Profitable Gaming Stocks Now
Our Methodology
To come up with the 11 most profitable gaming stocks now, we used stock screeners to identify gaming companies with highest profits. We then proceeded to rank the companies in ascending order of their Net Income over the past twelve months.
11. NCsoft Corporation (KS.036570)
Net Income TTM: $456 million
NCsoft Corporation (KS.036570) is a South Korean video game developer and publisher. The company is renowned for its multiplayer online role-playing games like Lineage, Guild Wars, Aion, and Blade & Soul. Lineage, first released in 1998, is one of the most successful massively multiplayer online role-playing games (MMORPGs) in history, with over 43 million registered users worldwide. Its subsidiary, NCSOFT West, is responsible for its gaming portfolio across the Americas, Europe, Australia, and New Zealand.
On February 9th, 2023, NCsoft Corporation (KRX:036570) posted its results for Q4 2022, reporting revenue of KRW 547.9 billion, falling short of analysts’ expectation by KRW 14 billion.
In addition to NCsoft Corporation (KS.036570), Sony Group Corporation (NYSE:SONY), Tencent Holdings Limited (OTC:TCEHY) and Nintendo Co., Ltd. (OTC:NTDOY) are included in our list of 11 most profitable gaming stocks now.
10. 37 Interactive Entertainment Network Technology Group Co., Ltd. (SZ.002555)
Net Income TTM: $493 million
37 Interactive Entertainment Network Technology Group Co., Ltd. (SZ.002555) is a Chinese mobile game developer and publisher. The company has a well-known game development studio called 37Games. The company distributes games through its own publishing platforms called 37Online and 37Mobile. 37 Interactive Entertainment Network Technology Group Co., Ltd. (SZ.002555) also operates a platform for online education called MiaoCode. In addition to developing and publishing games, 37Games is also involved in esports and has sponsored and hosted tournaments for its games. The company has received numerous awards for its games and contributions to the gaming industry.
9. Bandai Namco Holdings Inc. (OTC:NCBDF)
Net Income TTM: $879 million
Bandai Namco Holdings Inc. (OTC:NCBDF) is a Japanese multinational entertainment conglomerate. Bandai Namco Entertainment Inc.’s subsidiary is responsible for the company’s game development and publishing operations. This company owns famous video game franchises such as Pac-Man, Tekken, and Dark Souls. In addition to video games, Bandai Namco Holdings Inc. (OTC:NCBDF) is involved in the development and production of anime, manga, toys, and amusement park attractions. The company has a global presence, with offices and subsidiaries located in North America, Europe, and Asia.
8. Nexon Co., Ltd. (T.3659)
Net Income TTM: $971 million
Nexon Co., Ltd. (T.3659) is a Japanese video game company renowned for being a trailblazer in the MMORPG genre and for introducing the first free-to-play game. The company operates 80 live games that are available in over 190 countries. Some of Nexon Co., Ltd. (T.3659)’s most popular gaming franchises include Maple Story, Dungeon & Fighter, Sudden Attack, and Kart Rider. In addition to MMOs, Nexon has also developed and published mobile games, including popular games such as Darkness Rises and Overhit.
On February 9th, 2023, Nexon Co., Ltd. (T.3659) posted its results for Q4 2022, reporting revenue of ¥81.1 billion. The company reported a loss per share of ¥9.18.
7. Electronic Arts Inc. (NASDAQ:EA)
Net Income: $1.03 billion
Electronic Arts Inc. (NASDAQ:EA) is a US-based video game publisher that produces games for consoles, PCs, and mobile devices. The company has a global community of approximately 600 million active players and fans. Among its most well-known gaming franchises are The Sims, FIFA, Apex Legends, and Star Wars.
On January 31st, 2023, Electronic Arts Inc. (NASDAQ:EA) posted its results for Q3 2022, reporting revenue of $2.34 billion that fell short of market expectations by $159.33 million. Its Normalized EPS stood at $2.5 per share, missing analysts’ estimates by $0.55 per share.
Speaking on the company’s recent result, CFO Chris Suh said in a statement:
As market uncertainty mounted during the quarter, we took measures to protect underlying profitability. We are prioritizing the player experience, directing investment to where it can have the most positive impact for our players and on growth.
6. Activision Blizzard, Inc. (NASDAQ:ATVI)
Net Income TTM: $1.51 billion
Activision Blizzard, Inc. (NASDAQ:ATVI) is an American game developer and publisher. Activision Blizzard, Inc. (NASDAQ:ATVI) has three operating units: Activision, Blizzard Entertainment, and King. Call of Duty, World of Warcraft, Candy Crush, and Farm Heroes are some of the most successful games developed by the company.
On February 6th, 2023, Activision Blizzard, Inc. (NASDAQ:ATVI) released its results for Q4 2022, reporting revenue of $3.57 billion, surpassing analysts’ expectations by $384.51 million. Its Normalized EPS came in at $1.87 per share, beating market estimates by $0.36 per share.
Here is what Cooper Investors specifically said about Activision Blizzard, Inc. (NASDAQ:ATVI) in its Q2 2022 investor letter:
Activision Blizzard, Inc. (NASDAQ:ATVI) – our investment preceded news that the company was under investigation for workplace bullying. When it became clear management had misled the market on the extent of the problem we sold, led by our principles of Responsible Investing. We did not benefit from the subsequent M&A premium paid by Microsoft.
5. NetEase, Inc. (NASDAQ:NTES)
Net Income TTM: $2.94 billion
NetEase, Inc. (NASDAQ:NTES) is a Chinese technology company that operates a range of online services, including e-commerce platforms, online gaming, and music and video streaming services. The company’s most popular games include Fantasy Westward Journey and Onmyoji. The company has sold over 5.3 billion video games and more than 800 million hardware units worldwide.
On February 23rd, 2023, NetEase, Inc. (NASDAQ:NTES) announced its earnings report for Q4 2022, reporting revenue of $3.67 billion, missing market estimates by $26.16 million. The company’s Normalized EPS stood at $1.44, beating expectations by $0.30.
4. Nintendo Co., Ltd. (OTC:NTDOY)
Net Income TTM: $3.36 billion
Nintendo Co., Ltd. (OTC:NTDOY) is a multinational video game company based in Japan. Some of its most iconic gaming franchises include Super Mario Bros., Legend of Zelda, and Pokémon.
Nintendo Co., Ltd. (OTC:NTDOY) has released a total of eight gaming consoles to date. Its most recent console, the Nintendo Switch, has been a major success, with 114.33 million units sold as of November 2022.
3. Sony Group Corporation (NYSE:SONY)
Net Income TTM: $6.7 billion
Sony Group Corporation (NYSE:SONY) is a Japanese multinational corporation that is involved in the manufacturing of electronics and has a presence in the entertainment industry as well. One of its notable subsidiaries is Sony Interactive Entertainment, which develops and produces the popular PlayStation gaming consoles. Sony Interactive Entertainment has released several iterations of the console, with the latest being the PlayStation 5, launched in 2020. Its PlayStation brand dominates the gaming console market, with the presence of Microsoft’s Xbox as its main competitor. Sony Interactive Entertainment also produces exclusive game titles, such as The Last of Us and God of War series, known for their innovative gameplay, storytelling, and graphics.
On February 2nd, 2023, Sony Group Corporation (NYSE:SONY) announced its financial results for the third quarter of the fiscal year 2022, reporting revenue of $26.51 billion, missing estimates by $1.46 billion.
2. Tencent Holdings Limited (OTC:TCEHY)
Net Income TTM: $25.61 billion
Tencent Holdings Limited (OTC:TCEHY) is a Chinese corporation that operates in both the technology and entertainment industries. Among its subsidiaries is the Interactive Entertainment Group, which manages the company’s interest in game development and publishing. On the development side, It has five internal studio groups: TiMi Studio Group, Lightspeed Studios, Aurora Studio Group, Morefun Studio, and Next Studio. Tencent Holdings Limited (OTC:TCEHY) has had great success with several popular games, including Call of Duty: Mobile, Honor of Kings, and PUBG. These games have gained a large following and have been particularly successful in the mobile gaming market.
1. Microsoft Corporation (NASDAQ:MSFT)
Net Income TTM: $67.44 billion
Microsoft Corporation (NASDAQ:MSFT) is a leading American technology company known for its Windows operating systems and Microsoft Office suite. The company entered the gaming industry with the release of the original Xbox console on November 15, 2001, under the Xbox brand. The Xbox brand has since expanded, offering various consoles, including the latest X Box Series S|X, and a network of 23 game development studios under Xbox Game Studios. Additionally, the brand provides subscription services, such as Xbox Game Pass and Xbox Live.
Perhaps the biggest reason why Microsoft is on our list of the gaming stocks is because of its planned acquisition of Activision. Recently, Reuters reported that Microsoft Corp is expected to win EU antitrust approval for its $69 billion acquisition of Activision.
On January 24th, 2023, Microsoft Corporation (NASDAQ:MSFT) announced its result for the second quarter of the fiscal year 2023, reporting revenue of $52.7 billion, which missed market expectations by $404.99 million. The Normalized EPS stood at $2.32, surpassing analyst’s expectations by $0.1.
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Disclosure: None. 11 Most Profitable Gaming Stocks Now is originally published on Insider Monkey.
