15 January 2024

General Industry Update

Looking back on 2023, the global video games market displayed notable resilience, generating $184.0 billion with a modest year-on-year growth of +0.6%. Projections suggest a continued uptrend, reaching $205.7 billion by 2026, marking a 2021-2026 CAGR of +1.3%. 

Console gaming contributed significantly over the year, amassing $53.2 billion and growing by +1.9%. The standout performer, however, was the PC segment, witnessing robust +3.9% growth to hit $40.4 billion. Notably, premium releases on PC showcased their ability to drive segment growth alongside live-service games. 

2023’s Top 10 single platform release games from companies held by the Fund include “Diablo IV” (#3), “The Legend of Zelda: Tears of the Kingdom” (#4), “EA Sports FC24” (#5), “Madden NFL 24” (#6), and “Marvel’s Spider-Man 2” (#9). On PC, the top 10 games for the year from companies held by the Fund include “Call of Duty: Modern Warfare III/Warzone 2.0” (#2), “Minecraft” (#3), “Roblox” (#5), and “FIFA 23” (#9). 

Player numbers globally surged to 3.38 billion in 2023, marking noteworthy +6.3% year-on-year growth. Emerging regions played a pivotal role in driving this surge, with the total number of payers reaching 1.47 billion, growing by +7.3%. The availability of local payment options emerged as a critical factor in unlocking the games market’s growth potential. 

In H1 2023, the top 10 public game companies collectively generated $54 billion, accounting for nearly 30% of the market’s annual revenues. And with their merger, the combined revenues of Microsoft and Activision Blizzard totalled $10.4 billion in H1. This shifted Microsoft to the #2 position in gaming revenue, displacing Sony to #3 for the first time in revenue tracking history.¹

While the collaboration between Microsoft and Activision Blizzard is expected to reshape the global gaming market in 2024 and beyond, one piece of baggage the now-merged companies won’t be bringing with them into the new year is any lingering concern over a California legal case alleging gender-based discrimination at Activision Blizzard between 2015 and 2020, before merger talks began. 

In December, Activision Blizzard agreed to pay approximately $55 million in compensation to female employees and contractors who alleged the company denied them promotion opportunities and paid them less because they were women.²

Company Specific Updates

Take-Two Interactive Software

As part of its 25th anniversary celebrations in December, Rockstar Games, a publishing label of Take-Two Interactive Software (held by the Fund), announced that the long-awaited Grand Theft Auto VI is coming to PlayStation and Xbox 2025. In their announcement, Rockstar Games promised to continue to “push the limits of what’s possible in highly immersive, story-driven open-world experiences.”³

Source: Rockstar Games
Link: https://bit.ly/3tXfcWO

The predecessor in the series, GTA V (2013), continues to generate hundreds of millions in annual revenue and is the second-most watched game streaming on Twitch despite being more than ten years old. GTA V has sold more than 185 million copies to date and has made nearly $8 billion in revenue on a production budget of ~$265 million. The majority of the game’s income comes from subscriptions and in-game purchases. With 78% of Take-Two Interactive’s revenues in 2023 derived from such subscriptions and in-game purchases, look for GTA VI to follow the same model once published.⁴

Nexon Co Ltd 

Nexon unveiled four highly anticipated games at December’s Game Awards in Los Angeles. Most promising amongst these was “The First Descendant,” a looter-shooter game boosted by a captivating new trailer played for those in attendance. The game is set to launch in summer 2024, following a successful beta test with almost two million global players. This title is slated for simultaneous release on Steam, PlayStation, and Xbox. 

Source: Nexon Co., Ltd.
Link: https://company.nexon.co.jp/en/

Also announced were “The First Berserker: Khazan,” an action RPG in development for both PC and consoles, offering players intense battles against monsters, as well as a collaborative DLC update between “Dave the Diver” and Black Salt Games’ fishing adventure game “Dredge,” which was released December 15. Meanwhile, “The Finals” from Nexon’s Embark Studios was a surprise same-day release on December 7. Having ranked as one of Steam’s most anticipated games, “The Finals” is now accessible on Steam, PlayStation, and Xbox. The diverse lineup announced demonstrates Nexon’s commitment to delivering engaging experiences across platforms.⁵ 

HERO ETF: Diversified Investing in Video Games 

Interested in a diversified approach to investing in video games? Canada’s first esports and gaming ETF, the Evolve E-Gaming Index ETF (HERO ETF), is an index-based exchange-traded fund that invests in the leading video game companies across the globe. To learn more about HERO ETF, please click here: https://evolveetfs.com/hero/. 

Portfolio Strategy and Activity 

For the month, Roblox Corp made the largest contribution to the Fund, followed by Nintendo Corporation and AppLovin Corporation. The largest detractors to performance for the month were NetEase Inc, followed by Nexon Co Ltd and Capcom Co Ltd. 



  1. Wijman, T., “Newzoo’s year in review: the 2023 global games market in numbers,” Newzoo, December 19, 2023; https://newzoo.com/resources/blog/video-games-in-2023-the-year-in-numbers
  2. Novet, J., “Activision Blizzard agrees to settle California case alleging discrimination against women,” CNBC, December 15, 2023; https://www.cnbc.com/2023/12/16/activision-blizzard-agrees-to-settle-california-sex-discrimination-case.html
  3. “Rockstar Games Announces Grand Theft Auto VI, Coming 2025,” BusinessWire, December 4, 2023; https://www.businesswire.com/news/home/20231204993583/en/
  4. Lu, M., “Charting Grand Theft Auto: GTA’s Budget and Revenues,” Visual Capitalist, December 5, 2023; https://www.visualcapitalist.com/charted-grand-theft-auto-revenue-and-costs/
  5. “Nexon Reveals Four Globally Anticipated Games at The Game Awards,” Nexon, December 12, 2023; https://pdf.irpocket.com/C3659/FpHG/o89t/hcw6.pdf
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Tags Activision Blizzard  call of duty  console gaming  gaming  HERO etf  Microsoft  video games