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Investment

Gaming Report: VC Trends and Emerging Opportunities 2023

The report examines global gaming venture capital activity in 2023, focusing on Q4 performance and broader industry trends. In the fourth quarter, 126 deals raised $1.0 billion, a modest 0.8 % increase in deal count and 10.4 % rise in value versus the prior quarter, yet both metrics fell sharply year‑over‑year by 17.6 % and 15.5 %. Cumulative 2023 activity reached $4.1 billion, the second‑lowest annual figure since 2017 and only slightly above 2019 levels. The data, sourced from PitchBook, cover all geographic regions and include studios, publishers, developer tools, SaaS platforms, and content segments. Key findings reveal that content‑related startups attracted the largest share of capital in Q4 ($438.4 million across 71 deals), followed by development firms ($288.7 million, 29 deals). Other segments—access, monetization, and gambling—experienced subdued activity. The report notes a shift in investor focus toward more mature business models such as SaaS and developer tools, reflecting the high capital intensity of game development. Methodologically, the analysis aggregates PitchBook’s deal database, reporting both quarterly and cumulative figures. It also highlights notable early‑stage deals (e.g., Stability AI, Leonardo.ai) and strategic acquirers (Unity, Sony Interactive Entertainment). The document concludes that while overall VC enthusiasm has cooled from the Web3 and metaverse peaks of 2020‑22, investment remains concentrated in content creation and developer tooling, suggesting a more realistic, sustainable growth trajectory for the gaming ecosystem.

market-analysis investment global

PitchBookJan 2023

Financial

Gaming Deals Report: Navigating Turbulence (H1’23)

The first half of 2023 marked a significant downturn in gaming industry deal activity, characterized by a sharp contraction in total deal value across private investments, mergers and acquisitions (M&A), and public offerings. Total private investment fell to $1.5 billion across 239 deals, representing a fivefold decline in value compared to the same period in 2022. M&A activity saw an even more dramatic 31x drop in value, falling to $0.9 billion as strategic investors shifted focus toward internal restructuring, layoffs, and cost optimization rather than aggressive expansion. The venture capital landscape remains dominated by early-stage activity, as pre-seed and seed rounds are less susceptible to macroeconomic volatility. While the number of early-stage deals remained relatively stable, the total capital raised shrank by more than half to $269 million. Late-stage investments have largely paused due to a closed IPO window and a lack of viable exit opportunities, leading to a disconnect between investor expectations and startup valuations. Geographically, North America led early-stage VC activity with 24 deals, followed by Western Europe and the MENA region. Public markets remained muted, with companies increasingly choosing to postpone listings or engage in share buybacks. Despite the general market cooling, artificial intelligence has emerged as a resilient niche; investments in AI-related gaming companies rose to $214.1 million across 19 deals in the first half of 2023. Analysts anticipate a potential recovery in the latter half of the year, driven by the closing of major pending deals, such as the Savvy Games Group acquisition of Scopely and Microsoft’s pursuit of Activision Blizzard, alongside a significant amount of unallocated venture capital waiting to be deployed.

mergers-acquisitions investment market-analysis+1

InvestGameJan 2023

Financial

Financial Results for the Third Quarter of the Fiscal Year Ending March 2023

Koei Tecmo Holdings presented its financial results for the third quarter of the fiscal year ending March 2023, revealing a period of transition characterized by a year-over-year decline in sales and profits. Net sales reached 49.4 billion yen, a 10.6% decrease from the previous year, while net profit fell 52.4% to 13.5 billion yen. This downturn is attributed primarily to a high baseline in the prior year driven by major packaged game releases and significant non-operating losses on the valuation of derivatives caused by a volatile financial environment. The entertainment segment remains the primary driver of the business, contributing 46.3 billion yen in sales. While console software sales saw a decline in physical package revenue, digital sales remained resilient, accounting for 78.8% of the entertainment segment's total sales. Geographically, the company maintains a balanced profile, with 51.6% of revenue generated in Japan and 48.4% from overseas markets, particularly in Asia and North America. Despite the dip in revenue, total unit sales actually increased by 4.9% to 5.98 million units, bolstered by strong digital downloads. Looking ahead, the company revised its full-year earnings forecast, raising its operating profit target to 34 billion yen while lowering ordinary and net profit expectations due to the aforementioned non-operating expenses. Growth strategy for the fourth quarter relies on a robust pipeline of global releases, including high-profile titles such as Wild Hearts, Wo Long: Fallen Dynasty, and Atelier Ryza 3. Additionally, the mobile sector showed momentum with the successful launch of Nobunaga’s Ambition: Ha-do and continued regional expansion of existing smartphone IPs. To support this long-term growth, the company increased its total headcount by 15.7% to 2,400 employees.

market-analysis investment global

Koei TecmoJan 2023

Report

Gaming Deals Report: 2023 Striving for Elevation

The report examines the 2023 gaming investment landscape and finds that overall deal activity collapsed, with private equity funding falling to $2.7 billion across 403 transactions and M&A volume shrinking to $78.2 billion for 121 deals. Public offerings were also weak, raising only $4.2 billion compared with a 2021 peak of $24.5 billion, reflecting tighter capital markets and uncertainty around exit multiples. Early‑stage funding remained muted. Seed and Series A rounds were limited, with average checks dropping to $13 million and fewer new early‑stage funds launching. Corporate co‑investments grew, as studios such as Sony, Tencent and Krafton moved from single‑stake purchases to joint investments with venture capital and private equity partners, seeking risk sharing while accessing new intellectual property. Geographically the market was highly uneven. North America and Western Europe dominated early‑stage activity, accounting for 51 deals worth $284.6 million, while regions such as Eastern Europe, MENAT and Africa saw only 4–25 transactions each. Late‑stage deals were similarly concentrated in North America and Western Europe, totaling 84 deals for $84 million. Corporate venture activity was modest, with only a handful of deals and $4.9 million in value. Methodologically the report aggregates all public and private equity transactions—including seed, Series A–C, late‑stage VC, corporate investments, IPOs, SPACs, PIPEs and fixed‑income deals—while excluding non‑public lead‑investor details. Deal value and count of lead deals are used as the primary metrics, with a disclaimer that the data is educational rather than investment advice.

mergers-acquisitions investment global+1

InvestGameJan 2023

Financial

Australian Game Development Survey FY2023 Industry Snapshot

The Australian Game Development Survey: FY2023 Industry Snapshot reveals a sector experiencing significant maturation and financial expansion. During the 2023 fiscal year, the local industry generated $345.5 million in revenue, marking a 21% increase over the previous year. This growth is mirrored in the workforce, which expanded by 17% to reach 2,458 full-time equivalent employees. The industry remains heavily export-oriented, with 87% of revenue derived from markets outside of Australia. The data indicates a diverse ecosystem where 32% of studios have operated for over a decade, while 45% are relatively new, having existed for five years or less. Despite the presence of established firms, the sector is primarily composed of small businesses, with 79% of studios employing fewer than 20 people. Geographically, Victoria remains the primary hub, accounting for 29% of studios and 41% of the total workforce. Diversity metrics show a shift in the labor force, with women representing 26% of employees and gender-diverse individuals making up 5%. Conducted by Bond University on behalf of the Interactive Games & Entertainment Association (IGEA), the survey gathered voluntary data from 111 Australian development studios between September and November 2023. The findings suggest that growth is heavily underpinned by government support, such as the Digital Games Tax Offset (DGTO) and state-level rebates, with 49% of respondents receiving some form of government funding. While 68% of studios predict continued income growth, the industry faces notable headwinds. The primary challenges identified include difficulty hiring staff with specialized skills, attracting early-stage development funding, and securing international publishing deals amidst tightening global economic conditions. Nevertheless, the sector maintains a cautiously optimistic outlook, with 63% of studios planning to hire additional staff in the coming year.

market-analysis employment investment+1

Interactive Games and Entertainment AssociationJan 2023

Report

Gaming Industry Report: Q2 2023

The report presents a comprehensive snapshot of the global gaming industry for Q2 2023, emphasizing market growth, investment dynamics, and emerging trends. Global revenue reached $201 billion in 2023, up 9% year‑over‑year, with North America and Asia‑Pacific driving the majority of gamer activity. Public market exposure is strong; leading gaming ETFs (ESPO, GAMR) outperformed the S&P 500 by 10–30% YTD. Venture capital activity, however, contracted sharply: total VC funding fell 38 % QoQ to $472 million across 85 Latin American rounds, with a 60 % decline in growth‑stage deals and a 22 % drop in total deal count. Early‑stage funding remains relatively robust, especially in Asia where growth rounds dominate. Key corporate developments include Apple’s Vision Pro spatial‑computing headset, Embracer Group’s restructuring toward first‑party IP and cost discipline, and the near‑completion of Microsoft–Activision Blizzard’s acquisition after regulatory approvals in the EU and US. The report highlights a shift toward user‑generated content (UGC) driven by popular IPs and the rise of generative AI tools that streamline asset creation, NPC design, and emergent gameplay. Geographically, Asia leads in venture activity (over 70 % of Q2 deals), North America shows a sharp early‑stage decline, Europe remains flat, and Australia and South America exhibit limited activity. The document concludes with a calendar of major industry events for 2023 and an overview of Konvoy’s investment focus on frontier gaming platforms.

market-analysis investment global+1

NintendoJan 2023

Report

Brazilian Game Industry 2023

**Fact Sheet 2023 – Brazil Game Industry – Executive Summary** Below is a concise synthesis of the most relevant data, trends and insights from the 2023 Fact Sheet (compiled July 2023) on the Brazilian games sector. All figures refer to the 2022‑2023 survey period unless otherwise noted. --- ## 1. Macro‑economic context | Indicator | 2022 | 2023 (survey) | |-----------|------|---------------| | **Growth of the sector** | +3 % (contrasting with a 4,3 % global decline) | Continued modest growth; Brazil remains one of the few markets expanding year‑on‑year. | | **International revenue share** | 70 % of studios earn > 50 % of their turnover abroad | 58 % of studios now sell internationally; 10 % have permanent reps or PR offices overseas. | | **Key export markets** | United States (58 %), Latin America (57 %), Western Europe (54 %) | Same hierarchy, with a noticeable rise in Western‑European share (from 49 % to 54 %). | --- ## 2. Industry structure & geography | Metric | Value | |--------|-------| | **Active development studios (2022)** | **≈ 1 042** (↑ ~ 2 % YoY) | | **Studios > 10 yr old** | 17 % | | **Studios < 2 yr old** | 19 % | | **Formalised studios** | 85 % (63 % of the non‑formalised plan to formalise within 2 yr) | | **Regional distribution** | Southeast 58 % (dominant hub), South 20 % (‑1 % YoY), Northeast 15 % (+1 % YoY), Center‑West 6 %, North 2 % (‑1 % YoY) | | **Unlocated studios** | 222 (data gaps) | *Implication:* The sector is highly concentrated in the Southeast, but growth is emerging in the Northeast and other regions, driven by remote‑work adoption and expanding local education programs. --- ## 3. Internationalisation & market exposure * **Export activity:** 58 % of surveyed studios reported sales abroad in 2022. * **Foreign representation:** 10 % maintain a dedicated overseas representative or PR office. * **International business exposure (2022 vs 2023):** * Visitor/Listener at foreign events – 33 % → 39 % * Exhibitor/Presenter – 17 % → 14 % * Commercial missions – 10 % → 13 % * International round‑tables – 30 % → 33 % *Key takeaway:* Participation in B2B events abroad is the most effective lever for increasing foreign sales and partnerships. --- ## 4. Technology stack (engines) |

market-analysis investment brazil

AbragamesJan 2023

Financial

Gaming Industry Report: Q2 2023

The report presents a comprehensive snapshot of the global gaming industry for Q2 2023, emphasizing market growth, investment dynamics, and emerging trends. Global revenue reached $201 billion in 2023, up 9% year‑over‑year, with North America and Asia‑Pacific driving the majority of gamer populations. Public market activity is robust; leading gaming ETFs such as ESPO and GAMR have outperformed the S&P 500, delivering 30.1% and 9.7% YTD gains respectively. Private‑market funding has contracted sharply, with Q2 2023 venture capital inflows falling 38% QoQ to $472 million across 85 Latin‑American rounds, reflecting a 60% decline in early‑stage deals and a 60% drop in North American early funding. Late‑stage VC activity remains comparatively resilient, though overall deal counts have fallen 22% QoQ. The largest platform and content deals in the quarter totaled $237 million, with Asia dominating tech‑platform investments (50% of top ten) and North America leading content deals. Geographically, Asia remains the most active region, while North America’s early‑stage pipeline has weakened. Europe shows flat VC activity, and Australia and South Africa recorded minimal deal flow. The report also highlights strategic corporate moves—Apple’s Vision Pro launch, Embracer Group’s restructuring toward first‑party IP, and the near‑completion of Microsoft–Activision Blizzard regulatory approvals—as well as broader industry shifts toward user‑generated content and generative AI applications. Overall, the gaming sector continues to expand in revenue while navigating a tightening investment environment and accelerating technological innovation.

market-analysis investment global+1

KonvoyJan 2023

Financial

FY2023 First Quarter Consolidated Financial Results [Japanese GAAP]

CyberAgent’s consolidated financial results for the first quarter of the fiscal year ending September 30, 2023, reveal a period of strategic investment and market fluctuation. Covering the period from October 1, 2022, to December 31, 2022, the data shows a slight year-on-year decline in net sales of 2.1%, totaling ¥167,577 million. The company shifted from a significant operating income of ¥19,804 million in the previous year to an operating loss of ¥1,255 million. This downturn resulted in a net loss attributable to owners of the parent of ¥5,002 million, compared to a ¥6,091 million profit in the same quarter of the prior year. Performance varied significantly across business segments. The Media Business, which includes ABEMA and Ameba, saw a 34% increase in net sales to ¥33,485 million, driven largely by the distribution of the FIFA World Cup Qatar 2022. However, high content and distribution costs led to an expanded operating loss of ¥9,356 million for the segment. The Internet Advertisement Business remained a stable core, growing sales by 8.9% to ¥95,639 million, though operating income dipped 13% due to economic conditions. Conversely, the Game Business experienced a sharp decline, with sales falling 29.9% to ¥40,916 million and operating income dropping 69.6% to ¥5,212 million as major titles moved away from their anniversary peaks. The consolidated financial position shows total assets increased to ¥423,028 million, primarily due to the issuance of convertible bonds, which also contributed to a rise in total liabilities to ¥211,331 million. Despite the quarterly loss, the company maintained its full-year forecast, projecting net sales of ¥720,000 million and operating income between ¥40,000 and ¥50,000 million. The report, prepared under Japanese GAAP, indicates that while short-term profitability was impacted by heavy media investments and game cycle volatility, the company continues to focus on the medium-to-long-term growth of its smartphone-based services.

investment market-analysis japan

CyberAgent, Inc.Jan 2023

Financial

Half-Yearly Report: 26‑Week Period to 27 November 2022

Games Workshop achieved record core revenue of £212.3 million during the 26-week period ending November 27, 2022, representing a 10.9% increase over the previous year. This growth was primarily driven by robust performance in the trade channel and a recovery in retail across the United Kingdom and Europe, even as online sales experienced a marginal decline and North American retail remained flat. Despite this top-line success, total profit before tax fell to £83.6 million from £88.2 million in the prior year. This contraction was largely attributed to a significant decrease in licensing income, which dropped to £14.3 million, alongside rising operational costs for materials, carriage, and staff investments. The financial landscape was further characterized by a decline in constant currency gross margins, which fell by 4.5% to 64.1% due to global inflationary pressures. To mitigate long-term risks and support future growth, significant capital was directed toward infrastructure, including expanded manufacturing facilities in Nottingham, a new sales office in Barcelona, and a major £4.9 million webstore platform upgrade. Strategic focus remains centered on global intellectual property expansion, highlighted by a preliminary agreement with Amazon Studios to explore media opportunities. The Group maintains a strong liquidity position with £85.2 million in cash and cash equivalents, allowing for the distribution of £54.2 million in dividends at 165p per share. While basic earnings per share decreased to 202.4p and the effective tax rate rose to 20.5%, the business remains a stable going concern. Management continues to monitor strategic risks involving IT infrastructure, intellectual property protection in media, and potential organizational complacency while navigating a complex macroeconomic environment.

market-analysis investment uk

Games Workshop GroupJan 2023

Financial

Games Investment Review: Q2 2023

Q2 2023 witnessed a pronounced contraction in game‑industry capital, with total investments falling 34 % to $676 M across 127 deals and M&A activity dropping 81 % in value to $108 M over 31 transactions. Early‑stage rounds dominated the quarter, accounting for 62 % of value and 88 % of volume, while European firms edged North American peers in total investment ($222.5 M vs $190.4 M). Despite the downturn, blockchain‑related deals remained a notable 43 % of top‑10 private investments, reflecting continued niche interest amid broader market caution. Within developer funding, total investment fell 6 % to $425.7 M across 92 deals, with early‑stage rounds still dominating (≈65 % of value). The median investment size returned to the historical $3 M, down from a Q1 peak of $5 M. M&A activity dropped sharply: only 31 transactions worth $108.4 M (≈81 % lower in value and 24 % lower in volume than Q1). Tech/Other, Console/PC, and eSports were the top segments by value. The crypto‑winter and increased SEC regulation cut blockchain‑related funding to $243 M (38 % lower in value), with the largest single investment being Everdome’s $50 M early‑stage round. Overall, exits (M&A + IPOs) were the third lowest in history at $119.8 M, driven mainly by a single VRFabric IPO. Geographically, North America remains the dominant market, accounting for 46 % of investment value and 40 % of volume, with the Middle East (25%) and Europe (19%) following. Within segments, Mobile leads in value (≈38 %), while Console/PC and Tech/Other are the largest by volume; Mass‑Community Games (MCG) represent a growing niche, especially in blockchain titles. The top ten blockchain deals total $1.7 B across 10 funds, yet overall new fund announcements in Q2 raised only $7.8 B— a 69 % drop from Q2 2022—highlighting a sharp contraction in venture capital and private‑equity inflows despite continued interest in blockchain gaming. Regulatory pressure has driven a sharp retreat of blockchain‑related activity in the U.S., with SEC lawsuits against Binance and Coinbase, Nasdaq’s cancellation of a crypto‑custody service, and a 37 % YoY drop in hedge‑fund cryptocurrency investments. Consequently, 248 blockchain games have become defunct, the U.S. talent pool has shrunk by 2 % annually since 2017, and 75 % of Americans distrust crypto’s safety. In contrast, Polygon has overtaken BNB and Solana as the leading platform, while China’s regulatory environment remains more permissive, evidenced by new gaming licenses and a positive Web3 white paper. The review’s methodology counts only closed deals, not announced ones, and records SPACs by money raised rather than post‑transaction valuations. Applied consistently for 14 years, this approach delivers a clearer view of capital deployed in the quarter and provides reliable data for companies assessing investment activity.

investment market-analysis global

Digital Development ManagementJan 2023

Financial

First Half 2023/24 Sales

Nacon reported consolidated sales of €70.8 million for the first half of the 2023/24 financial year, covering the period from April 1 to September 30, 2023. This represents an 8.7% decline compared to the same period in the previous year. The downturn was primarily driven by a lighter release schedule in the second quarter and a high base for comparison from the prior year. Gaming sales fell 5.7% to €44.3 million, while the accessories segment saw a 12.7% decrease to €24.9 million. Despite the overall decline in the first half, the back catalogue returned to growth in the second quarter, rising 5.2% to €9.3 million. The accessories market also showed signs of recovery, particularly in the United States, supported by an expanding installed base of current-generation consoles and strong demand for gaming headsets. Management attributes the temporary dip in new game sales to the timing of releases, noting that only two titles launched at the very end of the second quarter. The outlook for the remainder of the 2023/24 fiscal year remains positive, with the company confirming its guidance for strong growth in both sales and operating income. This optimism is supported by a dense release schedule in the second half, including high-profile titles such as Robocop: Rogue City, which achieved record presales, and Cricket 24. Additionally, the launch of premium hardware, such as the Revolution 5 Pro controller and the RIG 600 PRO headset, is expected to drive significant revenue growth in the accessories division through the end of the calendar year and into the fourth quarter.

market-analysis market-forecast investment+2

NaconJan 2023

Legal

Raport Bieżący ESPI Nr 1/2023

The Management Board of PlayWay S.A., a prominent Polish game developer and publisher, has established the official schedule for the publication of its periodic financial results for the 2023 calendar year. This disclosure, mandated by Polish capital market regulations for public companies, ensures transparency for investors regarding the timing of both individual and consolidated financial performance data. The scope of these disclosures covers the company’s operations throughout the 2022 and 2023 fiscal periods, reflecting its status as a listed entity on the Warsaw Stock Exchange. The reporting cycle begins with the release of the separate and consolidated annual reports for the 2022 fiscal year on April 28, 2023. Following this, the company will issue its consolidated quarterly report for the first quarter of 2023 on May 30, 2023. The consolidated semi-annual report is scheduled for publication on October 2, 2023, while the consolidated third-quarter report for 2023 will be released on November 29, 2023. These dates represent the final deadlines by which the company must provide its financial statements to the public and regulatory authorities. In accordance with specific regulatory exemptions, PlayWay S.A. will not publish separate quarterly reports for the fourth quarter of 2022 or the second quarter of 2023. Furthermore, the company intends to utilize integrated reporting formats. Consolidated quarterly and semi-annual reports will include condensed separate financial information, eliminating the need for the issuance of standalone individual reports for those periods. This streamlined approach to financial communication is consistent with standard practices for consolidated capital groups under Polish financial oversight.

investment market-analysis poland

PlayWayJan 2023

Financial

H1'23 Gaming Deals Report: Navigating Turbulence

The analysis evaluates global gaming‑sector deal activity for the first half of 2023, contrasting it with the same periods in 2020‑2022 to gauge the impact of a deteriorating macro‑economic environment. Private capital contracted sharply, delivering only $1.5 billion across 239 transactions—a 24 % drop in deal count and a five‑fold reduction in total value relative to H1 2022, with early‑stage pre‑seed and seed rounds bearing the brunt of the decline. Late‑stage venture financing also cooled, as investors faced limited exit pathways and softer valuations, resulting in just 12 late‑stage deals and a cumulative $40 million in capital. Mergers and acquisitions mirrored the private‑investment slump, with deal volume falling to 71 closures and aggregate value collapsing to $0.9 billion, a 31‑fold decrease versus the prior year. Strategic buyers shifted focus to internal restructuring and asset carve‑outs, while public‑market activity remained muted; only 30 listings or PIPEs were recorded, though U.S. markets showed tentative recovery compared with persistently weak European activity. Geographically, North America dominated early‑stage financing (24 deals, $138.7 million) and Western Europe contributed a modest share, while Eastern Europe, MENA and Latin America saw limited participation. Corporate investors executed a comparable number of deals to 2022 (15 versus 17) but at markedly lower total spend, reflecting a strategic pivot toward cost optimisation. Data derive from InvestGame’s closed‑transaction database, supplemented by S&P Capital IQ, and exclude gambling, betting and non‑gaming entities. The scope covers global gaming firms across PC, console, mobile and emerging VR/AR platforms, tracking deal types from seed rounds to control‑changing M&As for the period Q1‑Q2 2023.

investment market-analysis global

InvestGameJan 2023

Financial

DDM Games Investment Review Q4 2023 Executive Summary Report

Digital Development Management (DDM) provides a comprehensive analysis of global video game investments, mergers and acquisitions (M&A), and initial public offerings (IPOs) for the full year and fourth quarter of 2023. The review utilizes proprietary data spanning 16 years to track capital flow across industry segments including Mobile, Console/PC, eSports, AR/VR, and blockchain. The central thesis identifies 2023 as a year of "masked challenges." While the industry reached a record-breaking $81.1 billion in total transaction value, this figure was heavily skewed by Microsoft’s $68.7 billion acquisition of Activision Blizzard, which accounted for 85% of the year's total value. Excluding this outlier, M&A activity hit its lowest value since 2020, totaling only $8.0 billion. Similarly, pure investments fell to $4.4 billion across 616 deals, a 69% decline in value from 2022 and the lowest level since 2016. This contraction reflects a "corrective year" following pandemic-era highs, characterized by high-interest rates, macroeconomic headwinds, and a shift toward corporate restructuring and layoffs. Key findings highlight a "winter" in both eSports and blockchain. Blockchain investments dropped 72% in value year-over-year, while eSports saw significantly lower valuations, exemplified by FaZe Clan’s $17 million acquisition following a previous $725 million valuation. Conversely, Artificial Intelligence emerged as a growing interest area, securing $319 million across 61 investments. Geographically, Poland maintained its status as a global IPO hub, while Saudi Arabia’s Public Investment Fund signaled long-term disruption with major acquisitions like Scopely for $4.9 billion. The outlook for 2024 suggests continued volatility and "unprecedented layoffs" as companies divest non-core assets. However, DDM anticipates a stabilization in the latter half of the year as valuations bottom out, potentially triggering a wave of bargain-driven M&A activity. Methodology is strictly limited to closed transactions to ensure data consistency and accuracy.

investment mergers-acquisitions market-analysis+1

Digital Development ManagementJan 2023

Financial

Global Gaming Report 2023: Investment & M&A Overview

The global gaming industry experienced a significant year for deal-making in 2023, characterized by record-breaking transaction values and a return to pre-pandemic activity levels. Total disclosed deal value for closed transactions reached $86 billion, a figure heavily influenced by the $69 billion acquisition of Activision Blizzard by Microsoft. Despite a broader market stabilization, the industry saw 960 announced deals throughout the year, with a total disclosed value of approximately $20 billion. Mergers and acquisitions were particularly robust in the PC and console segments, which saw 44 deals, followed closely by mobile with 37. Notable transactions included Savvy Games Group’s $4.9 billion acquisition of Scopely and Tencent’s majority stake in Techland for $1.6 billion. Private financing remained steady, with over $3.5 billion raised across more than 750 rounds. While mobile led financing activity, blockchain and platform tools remained high-interest areas for venture capital firms such as Bitkraft and Andreessen Horowitz. Investors showed a clear preference for early-stage opportunities, with over 85% of fourth-quarter financings directed toward seed and early-stage companies. The geographic scope of the analysis is global, with significant data points covering North America, Europe, and Asian markets, particularly Japan, Korea, and China. Public market performance showed a gradual recovery, with the Drake Star Gaming Index rising 11.5% over the year. Looking toward 2024, the outlook suggests a steady increase in M&A activity, driven by strategic buyers like Tencent, Sony, and Savvy Games Group. Market trends indicate a shift toward smaller and mid-sized deals, a continued focus on artificial intelligence and VR/AR tools, and a potential resurgence of initial public offerings in the latter half of the year as public valuations improve. Private equity is expected to play a larger role in taking undervalued public companies private, while entrepreneurs are increasingly prioritizing early profitability over long-term growth.

mergers-acquisitions investment market-analysis+1

Drake Star PartnersJan 2023

Financial

Summary of Consolidated Financial Results for the Nine Months Ended December 31, 2022

Koei Tecmo Holdings Co., Ltd. reported its consolidated financial results for the nine-month period ending December 31, 2022, revealing a significant year-on-year decline across major profitability metrics. Prepared under Japanese GAAP, the data reflects the performance of the Japanese game developer and publisher during a period of contraction compared to the previous fiscal year. Net sales for the nine-month period reached 49,439 million yen, representing a 10.6% decrease from the 55,327 million yen recorded in the same period in 2021. Operating profit fell by 15.2% to 22,994 million yen. The most substantial declines were observed in ordinary profit and profit attributable to owners of the parent, which plummeted by 56.5% and 52.4% respectively. Earnings per share consequently dropped from 85.10 yen to 42.78 yen. These results were heavily impacted by non-operating expenses, specifically a 12,626 million yen loss on the valuation of derivatives and a 7,373 million yen loss on the redemption of securities. The company’s financial position also saw a reduction in total assets, which decreased from 219,803 million yen at the end of March 2022 to 189,092 million yen by December 31, 2022. This was driven largely by a sharp decline in current assets, including cash, deposits, and short-term securities. Despite the downturn in nine-month performance, the full-year forecast for the period ending March 31, 2023, anticipates a slight recovery in top-line growth, with net sales projected to reach 77,000 million yen, a 5.8% increase over the previous full fiscal year. However, full-year net income is still expected to remain 33.5% lower than the prior year's results.

investment market-analysis japan

Koei TecmoJan 2023

Financial

Drake Star Global Gaming Report 2023

The global gaming industry experienced a significant transition in 2023, moving from the hyper-growth phase of the pandemic toward a normalized market environment characterized by strategic consolidation and targeted investment. While the year recorded a massive $86 billion in closed deal value, this figure was heavily skewed by the landmark Microsoft-Activision acquisition. Excluding such outliers, the broader landscape shifted toward smaller, mid-sized transactions, with 163 announced M&A deals totaling $10.5 billion and over $3.5 billion raised across 750 private financing rounds. PC and console segments dominated the M&A space, whereas mobile and blockchain ventures captured the majority of private financing volume. Strategic priorities for industry participants have evolved to emphasize the acquisition of intellectual property and the integration of transformative technologies. Firms such as Aonic Group, Modern Times Group, and Xsolla have actively expanded their portfolios to incorporate content creation tools, multiplayer capabilities, and virtual reality infrastructure. This focus on long-term value creation is further evidenced by the industry’s increasing interest in generative AI and Web3, which are viewed as critical drivers for future growth and operational efficiency. Looking ahead to 2024, the market is poised for a steady increase in activity as private equity firms capitalize on undervalued public companies and major industry players like Tencent, Sony, and Savvy Games Group continue their strategic investments. Although the current climate reflects a cautious approach to valuation, the outlook remains positive, with expectations for a resurgence in IPO activity as macroeconomic conditions stabilize. The sector is effectively pivoting toward a more disciplined investment model, prioritizing sustainable growth and technological integration to navigate the complexities of the global gaming ecosystem.

mergers-acquisitions investment market-analysis+1

Drake Star PartnersJan 2023

Report

H1’23 Gaming Deals Report: Navigating Turbulence

The report examines gaming‑sector deal activity through the first half of 2023, contrasting it with 2022 and earlier periods. Private investment activity fell sharply, with early‑stage funding declining by 24% to $1.5 billion across 239 deals, while late‑stage venture capital cooled further; total private deal value dropped 90% from $2.9 billion in H1’20 to $0.3 billion in H1’23. M&A activity collapsed, with deal value plunging 97% to $0.9 billion and the number of transactions halving from 132 in H1’22 to 71 in H1’23, driven by weaker valuations and a scarcity of exit options. Public offerings remained muted; IPOs and PIPEs saw a 49% decline in value to $1.7 billion, reflecting market uncertainty and a shift toward private financing. Early‑stage venture capital, however, showed resilience: the number of seed and Series A deals rose to 73 in H1’23, surpassing pre‑COVID levels, though average round size contracted from $2.2 m to $1.9 m. Late‑stage rounds stayed subdued, with only a handful of Series B+ deals and limited follow‑on funding. Corporate investment activity remained flat in deal count but fell markedly in value, as strategic buyers focused on cost optimization and asset carve‑outs. Geographically, North America dominated early‑stage activity ($138.7 m), followed by Asia ($45.5 m) and Western Europe ($57.4 m). AI‑focused gaming deals grew modestly, with 19 transactions worth $214.1 m in H1’23 versus $145.8 m in H1’22, indicating a gradual but steady interest in generative AI applications. Methodologically, the analysis draws on closed transaction data from InvestGame’s proprietary database, covering control M&As, minority stakes, early‑stage VC rounds, late‑stage VC rounds, corporate investments, IPOs, SPACs, and PIPEs. The dataset spans 2020–2023, enabling year‑over‑year comparisons and trend identification.

investment market-analysis global

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