Thanks to the pandemic, gaming stocks like Activision Blizzard (NASDAQ: ATVI) and Zynga (NASDAQ: ZNGA) became notable growth stories. As millions faced lockdowns and unemployment, consumers flocked to both companies’ games. Now, that growth level could temporarily slow as parts of the world emerge from the contagion. The question now is whether the established gaming giant or the upstart mobile gaming company can better serve investors?
At the height of the pandemic last May, Grand View Research forecast a compound annual growth rate (CAGR) for the video game industry of 13% between 2020 and 2027.
While the contagion has probably frontloaded some growth, investors should not expect a long-term industry slowdown from the end of COVID-19. Thus, both Activision and Zynga stockholders can breathe a sigh of relief. Still, as companies that started at different times, each has taken a different path to success.