Drake Star Partners' latest Global Gaming Market report has provided new insights into the financial state of the gaming industry. While there has been a consistent increase in investment and mergers and acquisitions (M&A), private deals have seen a dip, and the market has yet to reach the peak seen in 2022 when 83 deals were recorded, largely driven by Zynga's massive acquisition.

Examining the M&A transactions, there was a peak in Q1 2022, and it's speculated that the upcoming closure of the Activision Blizzard acquisition could lead to another peak. However, such peaks heavily rely on a single company's acquisition, and the overall value may still be lower for other companies. The dip in deals could also be attributed to the high number of deals during the peak period.

There was a significant uptick in M&A activity in March, potentially driven by the end of the licensing freeze in China and the progress of the Activision Blizzard acquisition.

The performance of the Top 25 gaming companies showed contrasting fortunes. For example, Applovin saw a rise in May, while Embracer experienced a plummet due to poor financials and a failed $2 billion deal in June. This drop in fortunes for certain companies affected the overall performance of the Drake Star Gaming Index.

Private placements have been relatively healthy, with Q4 2021 and Q1 2022 experiencing the highest peaks in the last two years, although there has been a slight downward trend after that.

While M&A activity is back, it has not reached the same heights as in 2022. However, the anticipated completion of the Activision Blizzard deal is expected to positively impact the gaming industry, particularly the mobile sector. Microsoft's emphasis on mobile following the acquisition may further drive investment in the sector, as mobile leads the way in terms of money with major acquisitions like Scopely and Rovio by larger companies making headlines outside the mobile niche.

Source: Iwan Morris, Staff Writer at PocketGamer