Q1 2024 saw $2.4 billion in games industry investments, while M&As are up for the first time since 2022

Disney’s investment in Epic Games is responsible for $1.5 billion of that $2.4 billion total

Q1 2024 saw $2.4 billion in games industry investments, while M&As are up for the first time since 2022

It’s been a strong start to the year for mergers, acquisitions and financing deals, according to Drake Star’s Global Gaming Report Q1 2024, with 47 games industry M&As having taken place in the first quarter of the year.

On the investments side, 188 funding rounds raised $2.4 billion in those same three months, carried largely by Disney’s $1.5 billion investment into Epic Games to acquire an equity stake.

While not all of these deals and investments have been specific to mobile, they are noteworthy for the sheer volume, marking the largest number of games industry M&As since 2022 and a return to investment growth after a "long decline".

As for mobile-specific M&As, they totalled 10 in Q1, matching PC and console M&As combined. Platforms and tools saw the most activity around mergers and acquisitions, with 12 having taken place in the beginning of the year.

Because of all the deals, Drake Star expects M&A activity to "steadily increase" through 2024 and names Tencent, Scopely, Take-Two and Playtika among the companies to watch for their purchasing power.

Invest and exchange

The most active venture capitalists in the games industry’s Q1 2024 were Bitkraft, Andreessen Horowitz, and Griffin Gaming Partners, making 19, 11, and 9 investments respectively.

Meanwhile, on their native stock exchanges, Wemade, Take-Two, NetEase, Roblox, and Krafton were among the most successful video game companies. In fact, Wemade flew far ahead of the pack with a 79.4% spike in the first quarter of the year. Take-Two’s increase was by 46.5%.

Certain big players in gaming did see their stock exchange performance falter, however. Netmarble was down 3.3%, Unity 6.3%, Tencent 9.7% and Sega 11.8%. Worse still was Square Enix’s 16% decline, with the full scale of its "extraordinary losses" to be revealed later this month.

Though, overall, Drake Star’s report deems Q1 2024 to have been a strong start to the year for the games industry and expects investment growth to "stay hot", adding: "While early-stage companies will continue to dominate the deal volume, we expect a modest increase in mid / late-stage deals. AI, mixed reality, platform and tools continue to be hot segments • IPOs may reemerge soon."

And despite companies like Square Enix seeing a decline on native exchanges, Q1 looked much brighter for fellow Japanese gaming veteran Capcom, up 15.3% as its Monster Hunter series’ gigantic 20th anniversary celebration.

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