Within the entertainment world, the video game industry has grown exponentially during the last couple of years, alongside the hype for gaming stocks.
As a result of the rules imposed by the COVID-19 pandemic, a large part of the world’s population turned to video games as their main pastime, since it was one of the safest ways to keep in touch with friends during the lockdown. Gaming companies strategically decided to release new titles during this period in order to obtain higher profits as it was a kind of “high season”. This is how, between 2019 and 2021, the video game market grew by 26%.
Despite the health situation improving and the restrictions easing, the gaming industry has not lost its strength. A study shows that internet traffic during 2021 increased by 7.7% over 2020. Also, in January 2022, the number of users increased to 4.95 billion. Cloud technology opens the door for the ever-increasing internet user base to access gaming entertainment and support its market growth.
According to PwC’s Global Entertainment and Media Outlook report, this sector will reach $321 billion by 2026. This is inferred due to the fact that several companies in this sector have had positive numbers in their quarterly results.
Corsair Gaming
Corsair Gaming, Inc. is an American company that manufactures gaming and streaming equipment, components, and systems. Among its main products are gaming peripherals, keyboards, headsets, and EpocCam software.
After having a somewhat negative second quarter of 2022, which several analysts are calling “probably the low point,” the company’s stock is rallying on better-than-expected third-quarter results.
Despite the top line falling 20.3% year-over-year to $311.77 million, the figure was still better than expected by about $4.6 million. In addition, Corsair reduced its channel inventory as sales remained above prior-year levels on several products.
The company is optimistic that for the remainder of the year, it expects revenues to be between $1.325 billion and $1.375 billion.
Turtle Beach
Similarly, Turtle Beach Corp. also beat third-half expectations, and as a result, its shares rose nearly 21% last week.
The gaming accessories supplier has had to deal with some drawbacks; however, it managed to reduce its recurring operating expenses by 16% thanks to proactive expense management programs. Added to this, the company is expanding its product portfolio, as five of its six models are on the list of the top ten best-selling wireless headsets.
Positivity abounds around the company, which is why its revenues are expected to return to growth after several setbacks. For the remainder of 2022, Turtle Beach expects a net income of $250 million and a net loss per share of $1.35.
With the advancement of technology and new developments in the gaming world, it would seem that it is a profitable market. Are you encouraged to ‘get in the game’ and invest in any of these gaming stocks?
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