Newzoo''s report focuses on game companies'' revenue and growth in the last 12 months. It also reveals that the top ten game companies generated $126 billion in revenue. It also demonstrates how mergers and acquisitions will affect the industry: If the Microsoft-Activision acquisition had happened a year earlier, the company would have beaten Sony and Apple.
Out of revenue, the report also showed how the firms have increased in the last year. While the ten biggest companies generated a lot of revenue, they didn''t grow much. Instead, Newzoo reports that their expansion is likely to continue.
Tencent recorded the highest profits by a considerable margin: $32.2 billion. It also had 9.5 percent YoY growth. Both were driven by its live service games, such as Honor of Kings and Clash Royale. Sony and Apple were both silver and bronze on the list.
Microsoft was well-positioned for growth, particularly against its competitors: 0.9 percent against Nintendos, 1.9 percent, and Sony''s low levels. It highlights the success of the Game Pass service, which has recently passed the 25 million-subscriber mark. Nintendo and Sony are also experiencing a gloomy recovery following the 2020 epidemic.
How M&A changes things
According to Newzoo''s report, Microsoft might take a significantly higher position on the next year''s report. If one combine Microsoft and Activisions revenue, it would be in second place on the list. It would not defeat Sony by much, but it would still be higher. Similarly, if Take-Two already owned Zynga, it would make the top 10.
According to Newzoo, the mobile market is confronted with geopolitical concerns that might hampered its growth. Free Fire, a lucrative mobile game, was banned in India due to Tencent, the Chinese company, and Sea Limited, the company that grew the company, but said that its revenues would decrease dramatically in 2022.