Summary
Microsoftis open to more acquisitions in the gaming space, a senior company official has revealed. However, it may be a while untilMicrosoftactually adds to its growing family of game studios.
The company most recently did so in October 2023, whenMicrosoft completed the Activision Blizzard acquisitionafter spending around a year actively dealing with regulatory pushback. With a total cost of $75.4 billion, the all-cash purchase was not just the largest-ever gaming acquisition, but also the biggest deal of its kind in the entire technology industry.
But Microsoft isn’t done yet, at least in the sense that it sees more opportunities for gaming M&A activity in the future. That’s according to Microsoft Gaming CEO Phil Spencer, who said as much in a recent interview withBloomberg. “We definitely want to be in the market [for more acquisitions],” the executive said. Elaborating on that point, Spencer explained that all potential future acquisitions would hinge on finding “teams and technology and capability that add to what we’re trying to do in gaming.” His remark suggests thatMicrosoft’s approach to game studio acquisitionsremains largely unchanged.
Microsoft Isn’t Planning Any ‘Imminent’ Gaming Acquisitions
Nevertheless, Microsoft isn’t planning any “imminent” moves on the M&A front as of late 2024, Spencer said. The executive also suggested that blockbuster deals comparable to the size of the Activision Blizzard acquisition probably won’t be happening anytime soon, either. This is largely because Microsoft is still in the process of fully integrating its latest acquisition into its publishing business. These ongoing efforts have already resulted in some redundancies, leading toMicrosoft laying off hundreds of Activision Blizzard staffersover the course of 2024. The company’s gaming unit laid off over 2,000 employees since the turn of the year, though not all of them were from Activision Blizzard.
When we can find teams and technology and capability that add to what we’re trying to do in gaming at Microsoft, absolutely we will keep our heads up.
Microsoft Wants To Pursue More Gaming Partnerships in China
In the meantime, Microsoft wants to diversify its gamemaking operations by getting more involved with China. Spencer described the prospects of teaming up with Chinese studios for global releases as a “real opportunity.” His remark wasn’t referencing acquisitions, but conventional collaborations in the vein of the recently releasedAge of Empires Mobile, which was made in partnership withCall of Duty: Mobiledeveloper TiMi Studio Group, a subsidiary of Chinese tech giant Tencent.
The 2023 Activision Blizzard acquisition made Microsoft the third-largest game publisher in the world by revenue, behind Tencent and Sony Interactive Entertainment. And while the company now seems well-positioned to run a sustainable game publishing business moving forward, Spencer’s latest comments suggest that Microsoft still remains open to pursuing inorganic gaming growth through acquisitions.
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