CE Retailers Revelling In Demand For Gaming Products
Retailers such as JB Hi Fi, EB Games as well as the likes of Harvey Norman are raking in the dollars from a boom in demand for gaming, this is pulling along brands such as Logitech with their gaming accessory products as well as the likes of Alienware, Acer who have the #1 gaming PC, Lenovo with their recently expanded Legion gaming range as well as the likes of Gigabyte and MSI.
Also benefiting are software Companies such as Electronic Arts who overnight reported the strongest June quarter sales in the video game company’s 38-year history.
“The quarter was so wildly beyond our expectations,” Electronic Arts’ finance chief Blake Jorgensen said in an interview. “Normally it’s one of our quietest quarters.”
According to research groups the COVID-19 epidemic has seen a sales explosion across the $149 billion global games industry, bringing back lapsed players, attracting newcomers, and driving already heavy gamers to play more often, industry executives and analysts claim.
Activision Blizzard and Take-Two Interactive are also forecasting strong financial results for the period when they report earnings next week. Also benefiting from the gaming boom are network Companies who are currently struggling to get stock to retailers in Australia.
Analysts claim that several big brands benefited from players spending more money on virtual perks such as digital costumes for characters.
Collectively, the companies are projected to more than double their adjusted earnings from the year-earlier quarter, according to analysts polled by FactSet.
Ironically, investors have been bullish on the on the gaming companies’ prospects, with the share prices of all three industry software giants rising an average of 27% during the past three months.
Console makers Microsoft and Sony who are both set to launch new models in Australia in time for last quarter Xmas and New Year shopping are also benefiting from the boom in demand for gaming.
Microsoft has had a 65% increase in Xbox content and services revenue in its most recent quarter.
Game publishers expect Sony’s new PlayStation 5 and Microsoft’s new Xbox Series X, due out later this year, to be key sales drivers for the likes of JB HI Fi and The Good Guys as well as EB Games and Harvey Norman.
Spending on game software world-wide is projected to climb 9.3% this year to $159.3 billion, according to estimates from research group Newzoo. That would be up from a 5.2% increase in 2019, according to the analytics firm’s report from last year.