February 29, 2024

2022 Second Best Year For Gaming Investments And M&A Ever

Despite being a turbulent year for the industry, 2022 has emerged as the second best year for gaming investments, mergers and acquisitions in its history, according to DDM’s Q4 2022 Games Investment Review.

The industry saw 1182 investments and deals worth a collective $51.5 billion, second only to 2021’s record-breaking $74.5 billion over 1219 deals.

Of the $51.5 billion figure, $13.4 billion came from 893 transactions, with the remaining $381 billion coming from mergers and acquisitions. This puts 2022 in third place in terms of investment, behind 2021 and 2020, which saw $13.5 billion over 489 transactions.

However, 2022 was unrivalled in terms of mergers and acquisitions, totalling $38.1 billion over 289 transactions. Notably, this doesn’t include the $69 billion acquisition of Activision Blizzard by Microsoft, which has yet to be closed. Should the deal be concluded successfully this year then not only would 2023 be the third successive record-breaking year in terms of M&A, but this one transaction would almost double 2022’s total, and leave the industry well-poised to break 2021’s record for gaming investments and M&A.

Breaking down the numbers

In terms of investments, deal value fell 67.3% in 2022 compared to 2021. However, the volume increased 3% compared to 868 in 2021. This suggests that 2022 saw investors choosing to invest less money into more companies.

Deal value decreased throughout the year, with Q4 accounting for $1.2 billion across 164 investments. While this puts Q4 2022 as the second-best Q4 in terms of deal volume, behind 269 in 2021, it represents the lowest deal value for the quarter since 2019.

55% of the recorded M&A value for the year came from just three acquisitions: Take-Two’s acquisition of Zynga ($12.7 billion), Unity’s acquisition of ironSource ($4.4 billion) and Sony’s acquisition of Bungie ($3.7 billion.)

Despite a mixed quarter in terms of investment, Q4 2022 was the second-best fourth quarter in terms of M&A value with a collective $4.9 billion. This places the quarter behind only Q4 2013, when acquisitions of Activision Blizzard, Supercell, and Youzu Interactive, among others, raised a collective $5 billion.