According to the news report by CNBC, Electronic Arts Inc.’s share price soared by 16% on Friday after the company announced that its new game Apex Legends – a direct competitor to Epic Games’ Fortnite – garnered 10 million players within 72 hours of its launch.
Bloomberg reported that this is the biggest gain that the company has seen in its share price since 2014.
Just a few days ago, when the Chief Executive Officer Andrew Wilson reported the company’s third quarter 2019 earnings, the company’s stocks plunged by 13% on Wednesday. Wilson had reported at that time that EA had not performed up to expectations.
The company’s biggest rival, Activision Blizzard Inc. is scheduled to report its quarter earnings results on Tuesday next week.
The company had reported that its revenue had missed targets. The company reported revenues of $1.61 billion, which was below the expectation of $1.75 billion.
EA’s stocks have dropped by 0.3% in the last three months. However, thanks to Friday’s rally, the company’s stocks have once again soared. For the week, EA’s stocks are up by 7%.
Apex Legends, created by Respawn Entertainment, is a game similar to Fortnite in that it is a free-to-play, battle royale genre of gaming. This genre has been made popular by Fortnite.
Fortnite is considered a pioneer in making this genre of gaming as popular as it has become today. In fact, the speed with which gamers have adopted Apex Legends shows how traditional players have moved towards this type of gaming.
According to KeyBanc Capital Markets, it took Fortnite over 2 weeks to reach 10 million players. The firm also added a caveat, saying it was unfair to compare the two games, since the battle royale gaming market was much different 12 to 18 months ago. Despite that, the firm said, getting 10 million players in 72 hours was a laudable achievement.
Matthew Harrigan from Buckingham Research stated in a note to clients that the conditions on Apex Legends’ currently high activity could be oversold, and that the new game’s victory was still nowhere close to that massive user base of 200 million users that Fortnight has amassed.
Despite that, wealth and investment management company Gerber Kawasaki Inc.’s Nick Licouris said that this was the first time that the markets had seen any other game go head-to-head with Fortnight.
Fortune gave further details about the new game’s launch. The head of Respawn Entertainment Vince Zampella said that they hoped that people would love the new game as much as they, who developed it, did. Zampella said that they had never expected the kind of support as well as positivity they had seen towards the game.
EA surprised the market with its launch of Apex Legends. The game was, in fact, announced as well as launched in one single day. This new game is set in the Titanfall universe, which is EA’s most popular franchise. Titanfall is also a Respawn Entertainment creation.
By launching Apex Legends in an already existing universe, the company cashed in on an already built-in audience. However, while the initial figures are definitely encouraging, Apex Legends has a long way to go before it can prove to be a threat to the already established Fortnite.
According to Licouris, Apex Legends’ success was due to many factors, the biggest of which was that the game was launched without any technical issues interrupting gameplay. Another strategy that helped the gaming giant launch its new product so successfully was that the game was introduced and launched the same day. The surprise factor led to many trying out the game immediately.