Why Is Mobile Gaming Important for EA and Activision?
Mobile revenue for Electronic Arts (EA) rose 21% YoY (year-over-year) in fiscal 2Q17 to $149 million.
Jan. 27 2017, Updated 7:37 a.m. ET
Rise in mobile revenue
The mobile games segment has a low entry barrier compared to that of console and PC. Millions of players play free mobile games and compete against each other daily. The mobile gaming space is fast becoming a huge market with China (FXI) and other Southeast Asian countries leading the way.
Mobile revenue for Electronic Arts (EA) rose 21% YoY (year-over-year) in fiscal 2Q17 to $149 million. Mobile revenue accounted for 26.3% of total digital revenue in fiscal 2Q17. Electronic Arts focused on creating mobile titles in three of its four major sports franchises. After its launch in the third quarter of 2016, FIFA Mobile became the number one game on the App Store’s free games chart in 138 countries.
Record mobile revenue during the holiday season
According to the Wall Street Journal, citing Sensor Tower, holiday video game sales figures reveal an interesting sector trend. Spending on mobile games, especially those meant for Apple’s (AAPL) iOS and Alphabet’s (GOOGL) Android devices, rose 53% YoY (year-over-year) to a record $967.6 million in the week between Christmas Day and New Year.
King Digital’s player metrics
In 3Q16, King Digital’s GAAP (generally accepted accounting principles) revenue for in-game content reached $1 billion. King Digital’s mobile gross bookings and its average revenue per user (or ARPU) rose year-over-year in 3Q16.
Given King Digital’s large network of players, Activision Blizzard (ATVI) considers advertising to be a good opportunity. King Digital has been conducting in-network advertising tests.
As we noted earlier in this series, King had three of the top 15 grossing mobile titles in the United States in the App Store for the 11th consecutive quarter.