Pandemic demand for videogames and consoles has lifted share prices for game developers and their suppliers. Now, investor enthusiasm is permeating deeper into the plumbing of the global game industry.
Israeli startup ironSource Ltd., which provides advertising services for app-based game developers such as Activision Blizzard Inc., agreed on Sunday to merge with a special purpose acquisitions company, or SPAC, in a deal that will take it public, valuing it at $11.1 billion.
A string of game companies have sought to tap public markets as lockdowns have driven demand for in-home entertainment. Shares of Roblox Corp. , a popular videogame platform for children, soared in their public debut this month. Shares in Playtika Holding Corp. , an Israeli game developer that makes social casino games such as “Caesars Slots” and “Poker Heat,” jumped in its market debut in January. Discord Inc., a chat service popular with gamers, roughly doubled its valuation, to $7 billion, in a funding round late last year.
The surge in demand for games has benefited larger tech companies, too. Sony Corp. said its operating profit for the quarter ended in December rose 20% thanks to growth in its games divisions. Its shares are up 103% in the past 12 months.
Microsoft Corp. recently posted record quarterly sales, helped by stronger demand for videogames and the release of next-generation Xbox consoles.