The increasing supply of next-generation consoles should give fresh impetus to video game demand over coming years, with the blockbuster release cadence expected to accelerate and fuel industry growth.

The transition to new consoles is historically a boon for game software publishers as consumers eager to test the capabilities of their new machines spend more and as publishers ship more blockbusters to fully take advantage of this rising consumer spending.

Gaming experiences on mobile devices are also expected to make a quantum leap over coming years as 5G becomes mainstream and gives a boost to immersive augmented reality applications and game streaming.

Game streaming and cloud gaming will be major drivers as they will remove the need to buy expensive hardware to play games, accelerate the shift to subscription business models and usher in cross-play (users on a specific platform will have the ability to play/compete with users on other platforms).

The growing popularity of live streaming and eSports appears as a secular trend and is expected to offer both increased engagement and new revenue streams (media rights, sponsorship…) to game publishers.

In the longer term, gaming companies appear at the forefront of the Metaverse revolution, a 3D virtual world where users can remain engaged even when they are not actively playing: they can chat, watch others and share moments around special events (concerts, movies…). The Metaverse will come with its own economy and new monetization opportunities (advertising, NFT collectibles…).

Video gaming assets should then keep attracting M&A interest from Tech and Media giants seeking to bolster their content library amid the rise of video game streaming and to consolidate their position in the Metaverse.

INSIGHTS

Metaverse/Gaming: Monster Hunter Gives Fresh Impetus To Augmented Reality

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Gaming/Metaverse: New Product Cycle To Provide A Top-Line & Earnings Boost

Newsflow is the video gaming industry is definitely improving after the post-pandemic lull. Nintendo’s latest Zelda set a new record for the series (10 million units sold in 3 days), confirming that consumer spending on well-known franchises remains well oriented and largely unaffected by the macro environment. And importantly, most game publishers are now taking…

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Product Details

NAV & Performance

UBS

ISIN

CH0473580212

Currency

USD

Type

Active Equity

Issuer / Rating

UBS / S&P A+

Inception Date

20.12.2019

Liquidity

Daily