US equity markets posted their best first quarter in more than two decades. The NASDAQ Composite (QQQ) saw upwards price action of more than 16%. After the fourth-quarter sell-off, the US and global stock markets saw significant gains in the first quarter.
Electronic Arts managed to outperform the gaming space and broader markets due to the overwhelming response for its free-to-play game Apex Legends. Before launching Apex Legends, Electronic Arts was also having a dismal year. The company witnessed a selling spree after its earnings were released in February. Overall, gaming stocks had a terrible earnings season. There were concerns about revenue growth. Activision Blizzard, Take-Two Interactive Software, and Electronic Arts missed the top-line estimates. Activision Blizzard also lowered its 2019 outlook.
Tencent (TCEHY) reported a sharp fall in its fourth-quarter earnings. China’s ban on new video games and higher costs dragged Tencent’s earnings. China has resumed new gaming approvals this year, which might benefit Tencent. Although Tencent’s video gaming revenues fell in the fourth quarter, some of the other businesses like advertising had solid growth.