EA Benefits from Gaming’s Increased Popularity
EA Reported 3Q15 Earnings: Working towards Digital Transformation (Part 5 of 17)
Huge growth is expected
According to Research and Markets, a research firm, the global gaming market is expected to grow at a CAGR (compound annual growth rate) of 9.19% from 2013 to 2018.
A major game changer was the introduction and popularity of PCs and electronic devices in the gaming market. Earlier, the market was restricted to board games and associated video games. Also, the rise and penetration of the Internet influenced the development and commercialization of gaming.
To learn how mobile gaming impacts Electronic Arts’ (EA) growth, read Why Electronic Arts faces a growth opportunity in mobile gaming.
You can consider investing in the PowerShares QQQ Trust (QQQ) and the Technology Select SPDR (XLK) to gain exposure to EA. It accounts for about 0.35% and 0.47% of these ETFs, respectively.
Sophistication in mobile gaming
Over time, mobile gaming’s sophistication increased. As a result, more memory capacity is required to handle more advanced tasks. This is expected to drive DRAM’s (Dynamic random-access memory) demand in the end markets.
Activities—like multitasking, media encoding or decoding, and data synchronization—in advanced mobile computing devices will all require higher memory. This will benefit the semiconductor and gaming industry. Together, the top three players in the DRAM market—Samsung Electronics, SK Hynix Semiconductor, and Micron Technology (MU)—control more than 90% of the market.
Leading semiconductor companies—like NVIDIA (NVDA)—are also eyeing the gaming hardware market for their future growth. To read more about NVIDIA’s focus on the gaming market and its performance in 4Q15, read Nvidia targets Android gaming market with Shield.
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