- Video game stocks have surged in 2025, pushed by anticipated releases like Grand Theft Auto 6.
- Also fueling investor pleasure is the upcoming launch of the Nintendo Switch 2.
- The Global X Video Games & Esports ETF has quadrupled the S&P 500’s acquire year-to-date.
Shares of video game firms are hovering previous the broader inventory market in 2025 as buyers anticipate some high-profile software program and {hardware} releases within the yr.
The Global X Video Games & Esports ETF has surged 12% year-to-date, quadrupling the S&P 500’s 3% return over the identical interval.
US-listed shares of Japan-based Nintendo have led the cost, surging 23% year-to-date. The acquire has primarily been pushed by the latest unveiling of its next-generation console, the Nintendo Switch 2, which is anticipated to be launched in time for the vacation season.
With Nintendo’s present console approaching its eighth birthday in March, pent-up demand from shoppers is anticipated to be so excessive that Nintendo has mentioned it most likely will not have the ability to sustain.
Nintendo president Shuntaro Furukawa mentioned the corporate is “taking risks and proceeding with production so that we can meet as much demand as possible,” in keeping with a translation of the corporate’s earnings name final week.
Analysts at JPMorgan mentioned the anticipated backward compatibility of the Nintendo Switch 2 ought to allow Nintendo to promote vastly extra software program titles than it was in a position to do with the unique Switch console.
JPMorgan estimates Nintendo will promote 190 million software program models within the firm’s fiscal yr 2025, with that determine ballooning to 272 million by its fiscal yr 2029.
“We expect software sales volume to grow with help from 1) the introduction of partial forward compatibility for select titles and 2) backward compatibility,” JPMorgan mentioned in a report final month.
For Take-Two Interactive, the software program developer’s 16% rally to file highs this yr was bolstered by the corporate confirming final week that it stays on monitor to launch its highly-anticipated Grand Theft Auto 6 later this Fall.
Analyst expectations are excessive contemplating that its predecessor, Grand Theft Auto 5, is the third best-selling video game of all time, with 210 million copies, behind Minecraft’s 300 million models and 520 million copies of Tetris, in keeping with information from Gamespot.
Like the Nintendo Switch, the final Grand Theft Auto game was launched about 12 years in the past, and pent-up demand for the title is excessive. Analysts at Ned Davis Research mentioned they consider the game could sell 250 million units over its lifetime.
Another video game inventory that has surged this yr is China-based software program developer NetEase, which developed the favored Marvel Rivals game. The game permits customers to play greater than 30 completely different Marvel characters in a team-based fight.
For NDR analysts, the upside transfer within the video game sector has been unsurprising. The analysis agency advisable buyers purchase video game stocks late final yr, partially because of the anticipation of sturdy demand for the Nintendo Switch 2 and the “800-pound gorilla” that is Grand Theft Auto 6.
“New titles for 2025 — especially Grand Theft Auto VI — and the release of the Nintendo Switch 2 should ensure that a sales growth bottom is in for the industry,” NDR said in December.
Video game outperformance can also be stark relative to different types of media.
While video game firms are beginning to see their fortunes flip after a slowdown within the business, firms within the movie business are nonetheless struggling.
Shares of Warner Bros. Discovery, Disney, and Paramount Global have languished this yr. Warner Bros. Discover and Disney shares are down 5% and a pair of%, respectively, whereas Paramount inventory is up simply over 1%.
