"Game On" is The Fly's weekly recap of the stories powering up or beating down video game stocks.
NEW RELEASES: This week's major new game release is Electronic Arts' (EA) soccer sim "FIFA 21," out on October 9 for PlayStation 4 (SNE), Xbox One (MSFT), PC, and Nintendo Switch (NTDOY). Also out this week is "Baldur's Gate 3," a role-playing game by Larian Studios. The game rolls out in early access on October 6 on Microsoft Windows, macOS (AAPL), and Google Stadia (GOOG).
PIPER ENGAGEMENT NOTE: Piper Sandler analyst Yung Kim said in a research note released earlier that the firm's semiannual survey of over 9,800 students indicated increased video games engagement across the board, with teens playing daily up to 31% versus 26% in the Spring 2020 survey. Kim said that a primary beneficiary was Activision Blizzard (ATVI), as after a summer of staying at home, teens chose "Call of Duty: Warzone" as the free-to-play title they play the most at 62%, up from 33% in the previous survey. The analyst sees the data as positive for console publishers Activision, EA, and Take-Two (TTWO), as well as mobile publishers Zynga (ZNGA) and Glu Mobile (GLUU).
BARRON'S: Max A. Cherney wrote in a article for Barron's last week that videogame stocks are expected to get another major boost. For the past six months, nothing has shown up on time but there's one major consumer event proceeding as scheduled next month, namely the launch of new videogame consoles from Microsoft and Sony, Cherney said, noting that pre-orders for the Xbox Series X and PlayStation 5 sold out in a matter of hours last month, despite their $500 price tags. Shares of Activision Blizzard, Electronic Arts, and Take-Two Interactive Software are each up at least 24% this year, but if history is any guide, there are more gains to come, the author added. Cherney also noted that the next-generation consoles arrive with games "atop the entertainment pecking order," especially as many movie theaters are closed and Americans are still stuck at home. The author highlighted that, according to IDC, U.S. videogame sales are forecast to rise 19% this year to $45.6B, while the U.S. film box office peaked at $11.9B in 2018 and has grossed just $1.9B in 2020 so far.
OTHER STORIES TO WATCH:
Last Thursday, Blizzard announced that the release date for "World of Warcraft: Shadowlands," the new expansion for the company's acclaimed massively multiplayer online role-playing game, had been delayed, with executive producer John Hight saying that it is "important" for the company to "deliver an experience that meets our highest expectations." The game was originally slated for a late October launch, but Blizzard said it will instead be out later this year.
Video game platform Roblox is working with investment banks to prepare to go public in the U.S. in a listing that could arrive in early 2021, Reuters reported last week.
In other listing news, U.S. mobile gaming company AppLovin, which is backed by KKR (KKR), has tapped Morgan Stanley (MS) to lead preparations for an IPO which could arrive early next year, Reuters said yesterday.
Ubisoft (UBSFY) CEO Yves Guillemot said in a message to employees that 25% of anonymous respondents in an internal summer survey reported witnessing or experiencing misconduct first-hand, according to Kotaku's Ethan Gach.
EA announced yesterday that "Need for Speed Hot Pursuit Remastered," a remake of 2010's "Need for Speed Hot Pursuit" will be coming to PlayStation 4, Xbox One, and PC on November 6, and to Nintendo Switch on November 13.