Aream & Co.: Gaming Investment Market in Q3’25
Active M&A on the background of historic-low private investments.
This report was produced in collaboration with InvestGame.
Aream & Co. is a global investment bank with a focus on gaming.
State of the Gaming Market
Based on Sensor Tower data, Q3’25 is a record quarter for IAP revenue over the past 4 years. However, there’s a clear downward trend in game downloads - in Q3’25 the figure reached 11.9 billion, the lowest point in the last 5 years.
Starting from October 22nd, developers will be allowed to integrate external payment methods in their games on Google Play in the US. They will also be able to openly tell their users about the opportunity to buy items outside of the stores. The court decision mirrors the same regulation that happened earlier to the App Store on iOS.
Developers, with the help of an Xsolla Buy Button, were able to increase revenue up to 120% on iOS. Starting from October 22nd, the same results might be achieved on Android.
Asian developers showed the strongest revenue growth in the US compared to Q2’25. The leaders are Century Games, Florere, and CyberAgent.
Publishers from China, Vietnam, and Cyprus lead in install numbers. Pakistan stands out - publishers from this country grew downloads by 27% YoY.
Publishers from China, the US, and Japan lead in IAP revenue in Q3’25. The table shows that Asian companies are growing in revenue, while Western companies are having a harder time.
The situation with average MAU is similar - Asian companies are growing their audience, while Western companies are barely managing to retain theirs. This may reflect differences in project operation approaches.
The PC market continues to show fairly stable growth. Q3’25 was Steam’s best quarter in the last 5 years - project revenue reached $4.8 billion ($3.7 billion from paid games). The platform’s biggest releases of the quarter were Borderlands 4 ($104 million), Dying Light: The Beast ($65 million), and Hollow Knight: Silksong ($64 million). Only one major new release wasn’t based on a franchise - Wuchang: Fallen Feathers.
The console market isn’t as rosy. While Nintendo shows record Nintendo Switch 2 sales, Xbox Series purchases dropped by 25% (compared to last year). Sony is relatively stable. Among the main Q3’25 releases on PlayStation are sports titles and popular franchises.
Roblox shows amazing CCU results - the platform surpassed Steam with its entire project library. Fortnite isn’t doing well as the project’s CCU has been declining since the beginning of 2025.
Aream also notes an interesting trend. It seems Twitch has a serious competitor - Kick. The platform is actively winning over audience share.
Investment Market - Overall Picture
In Q3’25, 49 M&A deals were completed with a total volume of $56.9 billion - including the announced Electronic Arts deal, which hasn’t closed yet.
5 companies completed public offerings. Transaction amount - $0.5 billion.
82 private investments in Q3’25 are publicly known. Their volume was $0.6 billion.
Excluding the EA deal, the largest M&A deals of Q3 are: AppLovin’s gaming portfolio acquisition ($800M), Sony’s stake purchase in Bandai Namco ($464 million - 2.5% ownership), and the Prime Insights acquisition ($250 million).
Among notable public market deals, Corsair raised $225 million in loans and a revolving credit line.
The largest private deals - XR/AR headset manufacturer Viture raised $100M; Benchmark and Sequoia Capital invested the same amount in Decart (a generative model for creating open worlds in real-time). Goodjob Games raised $60M from Menlo Ventures, Anthos Capital, and Bessemer Venture Partners in a Series A round.
M&A in Detail
Q3’25 was a record quarter since Q4’25 in deal volume (including the Electronic Arts acquisition). Excluding it, the results are weaker than the previous 3 quarters. However, in terms of deal count, there’s a positive trend since Q3’23. In total, 130 M&A deals were closed in the first 9 months of 2025 - 11% more than in the same period of 2024.
Over the past 5 years, buyers have been interested in major developers and publishers with their own established IP.
Aream & Co. notes that over the past 12 months, most deals involved public companies.
EA and Activision Blizzard valuations are comparable - 7.4x - 7.6x EV / Revenue for the last 12 months and 20.8x - 21.2x EV / EBITDA for the last 12 months.
The acquisition premium was higher in the Activision Blizzard deal.
Aream & Co. notes that PE fund participation in gaming deals has increased significantly since 2021. Recent examples include deals with Niantic Games and Kammelna, as well as minority deals with Million Victories, Liftoff, and Dream Games.
Special note goes to Asian strategics’ interest in strengthening their positions in Western gaming markets. Notable players here include Krafton, Tencent, Nazara, and Sony.
Public Market Deals in detail
Strong activity on public markets in H1’25 slowed significantly in Q3’25.
Total deal volume for the first 9 months reached $10.4 billion - 73% more compared to the same period last year. But the number of deals decreased by 6% to 31.
Among the largest deals in the last 12 months: AppLovin’s senior notes issuance totaling $3.55 billion; GameStop’s convertible senior notes totaling $3.55 billion; PIPE deal between Ubisoft and Tencent for $1.25 billion.
All gaming companies have underperformed the Nasdaq index over the past 2.5 years (+118% since January 2023).
But those performing best are large, diversified gaming holdings - Nintendo, Sony, Electronic Arts, Bandai Namco, Tencent. They’re most resilient to market turbulence. Their index has grown by 84% since January 2023.
Starting from October 22nd, developers will be allowed to integrate external payment methods in their games on Google Play in the US. They will also be able to openly tell their users about the opportunity to buy items outside of the stores. The court decision mirrors the same regulation that happened earlier to the App Store on iOS.
Developers, with the help of an Xsolla Buy Button, were able to increase revenue up to 120% on iOS. Starting from October 22nd, the same results might be achieved on Android.
PC/console developers and publishers are doing relatively well - Capcom, Embracer Group, Ubisoft, Square Enix. Their index grew by 22% since January 2023.
Mobile companies are struggling - both in Asia (-2% since January 2023) and especially in the West, -38% since January 2023.
Naturally, this affects multiples. Western mobile companies trade at 4.5x EV/NTM (NTM = Next Twelve Months) EBITDA. Asian mobile companies - at 10.1x.
The market values PC/console companies highly - at 14.2x EV/NTM EBITDA, and best of all, large diversified holdings (16.2x).
Overall, almost all public gaming holdings gained value over the past year. Among Western mobile companies, only MTG is in positive territory.
However, valuation growth and revenue growth don’t always correlate. Many PC/console companies saw revenue decline in Q2’25 compared to the previous quarter, but valuations for many of them showed positive dynamics.
Private Investments in Detail
Things are bad. Private investment volume in the gaming industry continues to remain at historically low levels. Q3’25 saw the fewest deals in 5 years.
In total, $1.5 billion was invested in studios during the first 9 months of this year. That’s 63% less than the same period last year. 265 deals were completed during this time.
The number of early-stage deals is declining, and the number of Series A deals reached a five-year low.
Over nine months of 2025, $0.5 billion was raised in pre-seed and seed rounds across 125 deals. During the same period, $0.3 billion was raised in Series A rounds. There were 22 such deals in total.
The largest studio deals in Q3’25 include investments in Good Job Games, Distinct Possibility Studios, and Super Gaming.
The situation looks better for services. Large Series B rounds were conducted by Viture, Decart, and Appcharge. Combined, they raised $258 million.
Over the past 12 months, Bitkraft, A16Z Games, and Arcadia led in deal count.
In invested amounts, the leaders are Bitkraft ($113M), Bessemer Venture Partners ($97M), and Menlo Ventures ($83M).
Sony's $464M acquisition of a 2.5% stake in Bandai Namco is an interesting strategic move, especially given the current market dynamics where large diversified holdings are outperforming more focused companies. The timing seems smart - these types of established IP-rich publishers are trading at higher multiples (16.2x EV/NTM EBITDA) and showing more resiliance to market volatility. It's also telling that Asian strategics like Sony are increasingly interested in strengthening positions across the gaming ecosystem, while private investment in studios hits historic lows. This shift toward M&A over venture capital suggests a maturing industry where proven IP and operational scale matter more than ever.