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EA to Publish Velan's Action Game, Boost Gaming Portfolio

Zacks Equity Research

Electronic Arts’ EA is ramping up its effort in a bid to strengthen its gaming portfolio with new releases and partnerships.

The company recently announced that it has signed a publishing agreement with independent game developer, Velan Studios, known for developing content for Activision’s ATVI Destiny 2. Velan has also worked with Activision for its upcoming release Crash Bandicoot N. Sane Trilogy.

Per this agreement, EA will publish Velan’s team-based action games for consoles, PC and mobile that ultimately expands its portfolio.

Further, Velan has been able to lure top-notch talent, which includes the likes of developers who have worked on Guitar Hero, Skylanders, Super Mario Maker and Uncharted among others.

Electronic Arts Inc. Price and Consensus

Electronic Arts Inc. Price and Consensus | Electronic Arts Inc. Quote


EA Benefits from Apex Legends Performance

EA’s latest battle royale (BR) game Apex Legends has become an instant hit. Per reports from CNBC, the game is smashing the records of Epic Game’s Fortnite in this genre

Per reports, the game has garnered 50 million players within a month of its release compared to Fortnite, which reached the 40 million mark after four months. Moreover, Apex Legends witnessed 25 million downloads in its first week of release alone compared to Fortnite’s record of 10 million downloads over two weeks, post its launch in 2017.

Apart from Apex Legends, EA is also expected to come up with Star Wars Jedi: Fallen Order in April 13. Notably, the company has partnered with Disney DIS for the release of this single-player game. 

However, cancelation of open-world Star Wars game does not bode well for the company in the near term.

Intensifying Competition

EA faces significant competition from the likes of Activision and Take Two Interactive TTWO in the gaming industry.

Activision’s recent announcement of bringing Call of Duty to mobile is expected to affect the performance of EA’s shooter looter games including Battlefield V.

Furthermore, Take Two’s robust product portfolio with releases including Sid Meier's Civilization VI: Gathering Storm and Ancestors: The Humankind Odyssey is a concern for EA.

EA currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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