Videogame Stocks Outperform Market as Actors Vote to Expand Strike

Videogame stocks showed resilience on Tuesday, outperforming the broader market. This came after a late Monday vote by striking actors to expand their strike to include work on videogames. It is worth noting that the videogame market is even larger than the movies or television industry.

Notable companies covered by this agreement include Activision Blizzard Inc., Take-Two Interactive Software Inc., and Electronic Arts Inc. Other companies affected include Blindlight LLC, Disney Character Voices Inc., Formosa Interactive LLC, Insomniac Games Inc., Epic Games, VoiceWorks Productions Inc., and WB Games Inc.

While Activision Blizzard and Take-Two saw slight increases in share prices on Tuesday, Electronic Arts experienced a 0.5% decline. Playtika Holding Corp. also suffered a 2.1% drop in share value. It is worth noting that Microsoft Corp. faces an upcoming deadline on October 18th regarding its acquisition of Activision Blizzard, which amounts to $69 billion.

Overall, the market for videogame stocks showed resilience despite the strike, indicating the continued strength and importance of this industry.

While SAG-AFTRA contemplates its next steps, striking screenwriters with the Writers Guild of America are waiting for the terms of a tentative deal with Hollywood studios.

As news of the potential strike spread, shares of game-monetization companies experienced mixed reactions. AppLovin Corp. saw a modest increase of 1.2%, while Unity Software Inc., which is also aiming to enhance the monetization of its game engine, experienced a decrease of 1.4%.

It is worth noting that the overall market also saw declines during this period, with both the S&P 500 and the Nasdaq Composite dropping by 1.1%. The iShares Expanded Tech-Software Sector exchange-traded fund (IGV) also experienced a decline of 1.5%.

As negotiations and discussions unfold between SAG-AFTRA and videogame makers, the industry eagerly awaits the outcome, which could have a significant impact on the gaming community as a whole.