Microsoft (MSFT) has announced a new July 23 games event to reveal its video game lineup for the upcoming Xbox Series X console.
Microsoft will be debuting games with gameplay that include the much-anticipated Halo: Infinite from its profitable Halo series. The Halo franchise has been Microsoft’s main first-party draw for customers to its Xbox consoles, bringing in nearly $3.4 billion with over 65 million titles sold since its inception nearly 20 years ago. The company is expected to debut other titles under its rebranded Xbox Games Studios.
Microsoft shares were up 2% at market close on Monday at $210.70.
Since 2018, Microsoft has acquired 15 game companies to develop new titles under its game development umbrella. According to its annual report last year, for the fiscal year ending in June 2019, Microsoft spent $9.1 billion which included the acquisitions of five non-gaming companies. Microsoft did not disclose the purchase amounts for the game publishers. However, including its deal to buy Github for $7.5 billion last year, Microsoft’s other 19 acquisitions totaled $1.6 billion, for an average price of $84.2 million.
In an interview with Gaming Street on August 19 of last year, Xbox Games Marketing General Manager Aaron Greenberg said, “You never know, but right now I think where we are, with our 15 internal studios, we feel really good about the amount of content we’re getting from that.”
First-party games made by their respective console makers have historically been part of their strategy to retain their customer base. In May, Sony (SNE) stated that it was rebranding its first-party titles under its new Playstation Studios to communicate to customers its authorship of a game and to assure them a level of quality it will be getting from its titles. Sony recently announced its PlayStation 5 console on June 4.
Microsoft, however, plans to release its new Xbox Series X console with no first-party games at launch. The company wants to employ its strategy called “Xbox Play Anywhere” which will allow users to play titles like Halo: Infinite across multiple devices such as a PC.
Highlighting the company strategy, Greenberg added, “Supporting Xbox Games Pass on PC and console, we feel like we have a healthy set of content across multiple genres, multiple game types, that will excite our fans.”
Microsoft’s stock is up 34% year-to-date with a Strong Buy analyst consensus that breaks down into 21 Buy ratings versus 1 Hold rating and 1 Sell rating. The $210.74 average price target implies .02% upside potential for the shares in the coming 12 months. (See Microsoft’s stock analysis on TipRanks).
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