Yahoo Finance Live anchors discuss EA stock performance after reports of an Amazon acquisition surface.
Video Transcript
– Some big potential news in the gaming industry following reports that Amazon could be announcing a deal to buy video game-maker, Electronic Arts, on what would be one of the more impactful deals of recent memory. So our newsroom erupted when we heard this news. It has since been talked down a little bit by another publication shop.
– A lot bit. No, no, not just a little bit. This seems like this is not probably happening.
– This was a lot of speculation.
– Yes.
– So this came from a publication, really, none of us heard of before. I certainly haven’t heard about it. But it’s to be bugged by another publication, that is CNBC, talking that one down. But bottom line is this, if something like this were to happen, I mean, this is just the latest in a series of big deals in the video game industry. Of course, you had to Take Two swallow up Zynga, you have Microsoft still trying to solve Activision Blizzard.
And against this backdrop, you get a sense what in the world is Netflix doing? They don’t have any sports, they’re not even speculated to be involved with any of video game-makers, they’re tinkering around trying to get into video games. And you have potentially, again, potentially very speculatory year, you have Amazon coming here and potentially buying a company like Electronic Arts.
– This would be a massive deal for Amazon folded into if it goes through or if it was to happen into their Amazon gaming business. Of course, a business that also has Twitch for the streaming elements. You could see even more of the volume, the number of hours that are streamed on that platform going higher. Twitch was a steal by all accounts when you think of how much they paid, $970 million. Twitch at this point in time is worth far more than what Amazon paid for it.
And so they got a steal back in 2014 on that. You’ve got to think if they were able to combine the EA titles with the number of streamers and active accounts that are on a Twitch too, that absolutely just skyrockets the value of those EA titles and, perhaps, even weaves in some of those other advertising elements too that Amazon could pass through to get another part of the business as well.
– Yeah. I mean, it shows that even though it does seem like it’s really just– like, I just want to emphasize as much as I can that this is a rumor. And even the report, the original report seems to have been people are talking about this without actually. So, OK, so that being said, it also kind of illustrates to me that the power that Amazon still has where you mention maybe this is happening and you see this huge stock reaction which shows– leaving this aside for a moment, to your point, Andy Jassy has been quite acquisitive. Right? And getting into either getting into new businesses, building up existing businesses. And so, it’s still going to be really interesting to see what Amazon does next in that regard.
– Yeah. I think you’re learning. And, again, total speculation on this Electronic Arts deal, but you’re getting the sense that this is going to be a much different Amazon under Andy Jassy than Jeff Bezos. You could see Jassy has got his sea legs under him and he’s going to put his stamp on this company. And that looks to be through acquisition. IRobot, various medical businesses as well. I mean, clearly, he has he is focused on bulking up in areas that they’re not really big in yet.
– Well, he’s running it more like an ERP company than a startup. Jeff Bezos had been running it like a startup for so long and said we’ll just build it inside and then we’ll make this strategic acquisitions where they’re absolutely necessary to get us into a new sector or a new industry. But Andy Jassy is looking at this as a Salesforce, or SAP, would look at it in saying let’s just go out and let’s use some of the cash that we have. We’ve got the cash pile, let’s put it to work and let’s enter into that field so much more quickly as well.
– The other category basis would buy in was shutting down competitors, buying competitors, right? I think of developers.com is the one that springs to my mind.
Add Comment