We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Microsoft (MSFT) Reportedly Mulling Discord Buyout for Over $10B
Read MoreHide Full Article
Microsoft (MSFT - Free Report) is reportedly holding talks to purchase Discord for more than $10 billion, per a Bloomberg report. There has been no official comment on the development from either of the parties.
Discord is a voice, video and text communication platform, which is highly used by gamers for communication while playing video games online. The company boasts more than 100 million monthly active users. Citing Pitchbook data, Bloomberg noted that the company’s valuation stood at $7 billion in 2020.
Referring to sources familiar with the matter, Bloomberg further added that Discord was holding discussions with various buyers for some time now. Microsoft could be a potential buyer, but nothing is final yet.
Citing another source, Bloomberg added that Discord could even go public instead of the sale. Earlier, Discord reportedly proposed its sale to both Epic Games Inc and Amazon (AMZN - Free Report) .
How Microsoft Could Benefit from Discord Buyout?
The acquisition of Discord will help Microsoft as it pushes its video gaming business toward software and services as noted by a Bloomberg Intelligence Analyst. The analyst further added that the tech giant can further boost the subscriber base for its Game Pass subscription by integrating Discord’s superior offering Nitro with the service.
Microsoft has been revving up its video game business to fortify its position in the lucrative video game space against rivals like Sony and Nintendo.
Last year, there was a massive spurt in global video gaming activity due to the lockdown. Further, growing interest in esports, rapid proliferation of smartphones along with swift 5G deployment and adoption of advanced technologies like augmented/virtual reality (AR/VR) for next generation video games will act as catalysts for the overall gaming market.
Cloud gaming is witnessing considerable momentum as it enables access to video games on any android device anywhere and at any time.
As part of its strategy to reinvigorate its video game business, the company announced the acquisition of Bethesda Softworks’ parent company — ZeniMax Media — for an all-cash deal valued at $7.5 billion in September 2020.
Post the acquisition, all ZeniMax’s creative studios like Bethesda Softworks, ZeniMax Online Studios and Bethesda Game Studios, along with all their video game franchises will belong to Microsoft. This brings the number of in-house development studios to 23 from 15 for Microsoft.
Microsoft also launched next generation of gaming consoles namely Xbox Series X and Xbox series S in November 2020. The company expects its gaming revenues for fiscal third quarter of 2021 to be up 40% year over year on strong demand for the next-generation consoles. Also, Xbox content and services revenues are anticipated to grow in the mid-20% range.
Microsoft is working on its Game Pass Ultimate subscription service to drive console hardware business. The software giant has integrated its cloud gaming with Game Pass Ultimate at no extra cost for subscribers. The company also bundled Electronic Arts (EA - Free Report) EA Play service with the Xbox Game Pass Ultimate subscription at no additional cost to lure more subscribers.
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Microsoft (MSFT) Reportedly Mulling Discord Buyout for Over $10B
Microsoft (MSFT - Free Report) is reportedly holding talks to purchase Discord for more than $10 billion, per a Bloomberg report. There has been no official comment on the development from either of the parties.
Discord is a voice, video and text communication platform, which is highly used by gamers for communication while playing video games online. The company boasts more than 100 million monthly active users. Citing Pitchbook data, Bloomberg noted that the company’s valuation stood at $7 billion in 2020.
Referring to sources familiar with the matter, Bloomberg further added that Discord was holding discussions with various buyers for some time now. Microsoft could be a potential buyer, but nothing is final yet.
Microsoft Corporation Price and Consensus
Microsoft Corporation price-consensus-chart | Microsoft Corporation Quote
Citing another source, Bloomberg added that Discord could even go public instead of the sale. Earlier, Discord reportedly proposed its sale to both Epic Games Inc and Amazon (AMZN - Free Report) .
How Microsoft Could Benefit from Discord Buyout?
The acquisition of Discord will help Microsoft as it pushes its video gaming business toward software and services as noted by a Bloomberg Intelligence Analyst. The analyst further added that the tech giant can further boost the subscriber base for its Game Pass subscription by integrating Discord’s superior offering Nitro with the service.
Microsoft has been revving up its video game business to fortify its position in the lucrative video game space against rivals like Sony and Nintendo.
According to Mordor Intelligence report, the video gaming market is expected to witness a CAGR of 10.5% between 2021 and 2026.
Last year, there was a massive spurt in global video gaming activity due to the lockdown. Further, growing interest in esports, rapid proliferation of smartphones along with swift 5G deployment and adoption of advanced technologies like augmented/virtual reality (AR/VR) for next generation video games will act as catalysts for the overall gaming market.
Cloud gaming is witnessing considerable momentum as it enables access to video games on any android device anywhere and at any time.
As part of its strategy to reinvigorate its video game business, the company announced the acquisition of Bethesda Softworks’ parent company — ZeniMax Media — for an all-cash deal valued at $7.5 billion in September 2020.
Post the acquisition, all ZeniMax’s creative studios like Bethesda Softworks, ZeniMax Online Studios and Bethesda Game Studios, along with all their video game franchises will belong to Microsoft. This brings the number of in-house development studios to 23 from 15 for Microsoft.
Microsoft also launched next generation of gaming consoles namely Xbox Series X and Xbox series S in November 2020. The company expects its gaming revenues for fiscal third quarter of 2021 to be up 40% year over year on strong demand for the next-generation consoles. Also, Xbox content and services revenues are anticipated to grow in the mid-20% range.
Microsoft is working on its Game Pass Ultimate subscription service to drive console hardware business. The software giant has integrated its cloud gaming with Game Pass Ultimate at no extra cost for subscribers. The company also bundled Electronic Arts (EA - Free Report) EA Play service with the Xbox Game Pass Ultimate subscription at no additional cost to lure more subscribers.
At present, Microsoft carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>