As Millennials are spending more time playing games, making a major targeted audience for game developers and gaming companies, the demand for high quality and attractive games have conditioned the rise of the gaming industry, which is only becoming larger from year to year with an average growth rate of 8.2% on annual basis.
The increased demand for games and the rising quality thanks to technological advancement and development is only contributing to adding more value to this prominent industry, while the revenues are on the rise as a consequence, too, becoming a point of interest for investors as well.
Why You Should Consider Owning At least One Stock in the Gaming Industry
Not only that Millennials like to play attractive, high-quality games that come with more expensive and more advanced equipment and pricier games and in-game items that can be purchased for creating a more effective game play, but younger generations such as generation “Z” that is only coming of age now are interested in gaining access to video game streaming websites, such as Twitch in the ownership of Amazon.com, where users can watch other players in action without being directly involved in the game.
This example shows how progressive the industry of gaming is becoming, while analysts are predicting that the industry will get to see a market cap of 143 billion dollars by 2020.
At the same time, new sectors are emerging within this prominent industry, placing a focus on mobile gaming, which is now weighing around 50 billion dollars in revenue, also representing one of the fastest growing sectors.
Moreover, the advancement of technology within manufacturers such as NVIDIA is also driving more revenue to gaming companies, while the industry found a way towards accessing higher margins.
This is the case because gaming companies usually relied on new game releases which usually happens once in a year or every now and then, which limited the inflow of cash to the gaming industry.
However, with the changing trends, the industry is growing, able to acquire a year-round profit with consistency which appears to be doing wonders for gaming companies and the industry of games in general.