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Electronic Arts Buys Glu Mobile, Maker of ‘Kim Kardashian: Hollywood’

The second-largest U.S. game publisher makes a big play for the mobile market.
(OpturaDesign)
(OpturaDesign)
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Electronic Arts announced it is acquiring Glu Mobile in a multi-billion, all-cash deal, WSJ reports.

The Background: Glu is a mobile gaming company which is best known for “Kim Kardashian: Hollywood,” “Diner Dash” and “MLB Tap Sports Baseball.”

  • You might remember EA for games like FIFA and Battlefield, along with the popular mobile game “Star Wars: Galaxy of Heroes.”

Why It Matters: For the behemoth game-maker, the pickup of Glu helps expand the business in an area where it’s had mixed success. Meanwhile, Glu can tap into EA’s intellectual property, marketing expertise and global presence to grow its business. Glu will be integrated into EA, but its team will still work independently on its own portfolio.

Numbers To Consider:

  1. EA is paying $2.4 billion to acquire Glu, which has roughly 800 employees.
  2. Glu shares improved by 34% to $12.56 on the news in extended trading Monday.
  3. On Monday, Glu said its Q4 revenue increased by 25% to $141.4 million, from a year earlier.
  4. The company’s net bookings ticked up 15% to $124.8 million.
  5. Glu’s profit more than doubled to $23.9 million, compared to the year-earlier period.
  6. It also said it had 14 million monthly players at the end of the September quarter.

EA is the second-largest U.S. video game publisher, behind Activision Blizzard (by market cap). Both, and the industry, have benefited greatly from the pandemic-fueled push toward at-home entertainment.

  • Mobile games were about half of the $175 billion consumers worldwide dropped on video games last year, according to Newzoo BV.

The Takeaway: “EA has said it wants to more than double the number of gamers that play its sports games over the next five years.” A possible path to doing so is through the mobile market.

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