- Electronic Arts acquired the mobile games developer and publisher Glu Mobile for $2.4 billion, according to a company announcement. The transaction is expected to close at the end of June pending Glu shareholder and regulatory approval.
- The deal immediately adds "significant scale" to EA's mobile business, the release said. The companies' combined portfolio includes 15 live service mobile games that, taken together, brought in $1.32 billion in bookings over the past year.
- Founded in 2001, Glu has produced several hit titles, including Kim Kardashian: Hollywood, a game that saw a jump in user interest in 2020's fourth quarter, per a recent earnings report. The long shelf life of mobile games, along with a pandemic boost to engagement, speaks to why EA is moving quickly into the space.
EA, best known for developing games like the annual sports franchise Madden NFL for hardware consoles, is making a significant bet on mobile with the pricey Glu acquisition. Gaming has broadly felt a windfall from the COVID-19 crisis, with mobile experiencing significant gains. The category has seen 28% audience growth since the pandemic's outset as more consumers stay glued to their smartphones while stuck at home, recent Facebook research revealed.
"Mobile continues to grow as the biggest gaming platform in the world, and with the addition of Glu's games and talent, we're doubling the size of our mobile business," EA chief executive Andrew Wilson said in a press statement.
EA is particularly interested in "live services," or games that keep players hooked over the long term through ongoing updates and customization options, some of which are monetized.
"Glu's expertise in building and monetizing sports and casual mobile games, combined with Electronic Arts' industry-leading IP in sports and beyond, will accelerate the creation of exciting new experiences for broad audiences," the announcement reads.
Climbing audience interest in mobile gaming is reflected in Glu's recent performance. The developer, which also owns titles Design Home, Covet Fashion, Disney Sorcerer's Arena and MLB Tap Sports Baseball, saw revenue rise 25% year-over-year to $141.4 million in Q4, while bookings were up 15% YoY to $124.8 million, according to an earnings statement. Overall revenue for 2020 was up 31% to $540.5 million.
Kim Kardashian: Hollywood stands as one of the developer's most noteworthy offerings. The game, which debuted in 2014, served as an early example of how influencers like Kardashian could translate their brand into other channels, but it has remained popular as other mobile trends have died off. Last May, Kardashian extended her exclusivity agreement with Glu by several years.
This is EA's second major studio acquisition in recent months after snapping up Codemasters for roughly $1.2 billion in December; however, Codemasters creates games predominantly for consoles.
Mobile could present new revenue streams for EA, particularly in regards to advertising. Among consumers new to gaming, 35% prefer the ad-supported monetization model, Facebook's research found.
Mobile gaming M&A has been on the rise as companies chase the opportunity. Zynga, one of the largest players in the industry, last year bought hypercasual gamemakers Rollic and Peak for $180 million and $1.8 billion, respectively. Zynga CEO Frank Gibeau this week said the company was on the hunt for more acquisitions, per TechCrunch.