Mobile gaming continues to be one of the fastest growth sectors in the industry. In fact, five mobile games, led by Tencent’s Honor of Kings and PUBG Mobile managed to generate over $1 billion in revenues last year. For its part, leading publisher Electronic Arts believes it has substantial room to grow its mobile gaming business, which is largely driven by EA Sports titles like Madden NFL and FIFA – in 2019, EA Sports’ mobile titles surpassed $1 billion in lifetime revenue.
EA’s latest move to grow their mobile business was to purchase Glu Mobile for $2.1 billion, “building on its network of 100 million monthly active players in mobile and creating a market-leading portfolio of more than 15 top live services across multiple fast-growing genres.” With Glu’s MLB Tap Sports Baseball, EA now adds the American pastime to its soccer and football titles while also significantly improving its presence in the lifestyle genre that Glu has excelled at with titles like Covet Fashion, Design Home, and Kim Kardashian: Hollywood.
The best acquisitions are always ones that are complementary and additive to a business, and Glu Mobile certainly fits the bill for EA. Not only does the addition of Glu give the publisher immediate access to a wider female gaming audience, which it should be able to market and cross-promote its existing portfolio to (especially The Sims), but the two genres that EA and Glu have been leaders in are among some of the faster growing segments within mobile gaming. According to as Interpret’s New Media Measure®, year-over-year from Q4 2019 to Q4 2020, the lifestyle games genre grew from 12% of US mobile gamers regularly playing to 18%, while sports gaming grew from 10% to 15% during that time. Meanwhile, other more popular genres either held steady or dropped in popularity slightly over the last year. As more and more of the globe has been playing games on mobile, in part due to the pandemic, it’ll be interesting to see how much more growth the sports and lifestyle genres see. EA is in a great position to benefit from what we expect to be continued expansion.
