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Key takeaways
Microsoft and Activision Blizzard
In other stock-specific news, it was announced last week that after nearly two years of regulatory oversight and investigation, Microsoft has acquired Activision Blizzard, the video game producer, for more than $69 billion – the largest acquisition within the gaming industry.
The deal had been plagued by concerns over competition from regulators, something that was encouraged by competitor Sony. As the producers of the Xbox games console, Microsoft have been in direct competition with Sony’s PlayStation consoles for years, and there were concerns that Microsoft may choose to freeze Sony out of providing certain games franchises, such as Call of Duty, after the acquisition. However, the market share that Sony holds with the PlayStation is so large this would be detrimental to Microsoft and revenue made through those titles.
Support for large tech firms has returned this year, with Netflix and Microsoft up c.36% and c.38% year-to-date respectively. The latter has clawed back most of the ground lost during the growth sell-off in 2022. Netflix remains down c.33% since the start of last year but has also regained value having been down c.72% at its nadir during that period.
Bowmore portfolios
Although we do not hold exposure to direct stocks in portfolios, we do allocate to technology and cyber security thematic funds, which have benefitted from positive momentum in these sectors this year. Our cyber security allocation is up 17.8% year-to-date, with tech up 40.4% in sterling terms.
- Netflix shares surge more than 16% on subscriber growth.
- Nine million subscribers added in Q3 2023.
- Microsoft acquires Activision Blizzard for $69 billion
Microsoft and Activision Blizzard
In other stock-specific news, it was announced last week that after nearly two years of regulatory oversight and investigation, Microsoft has acquired Activision Blizzard, the video game producer, for more than $69 billion – the largest acquisition within the gaming industry.
The deal had been plagued by concerns over competition from regulators, something that was encouraged by competitor Sony. As the producers of the Xbox games console, Microsoft have been in direct competition with Sony’s PlayStation consoles for years, and there were concerns that Microsoft may choose to freeze Sony out of providing certain games franchises, such as Call of Duty, after the acquisition. However, the market share that Sony holds with the PlayStation is so large this would be detrimental to Microsoft and revenue made through those titles.
Support for large tech firms has returned this year, with Netflix and Microsoft up c.36% and c.38% year-to-date respectively. The latter has clawed back most of the ground lost during the growth sell-off in 2022. Netflix remains down c.33% since the start of last year but has also regained value having been down c.72% at its nadir during that period.
Bowmore portfolios
Although we do not hold exposure to direct stocks in portfolios, we do allocate to technology and cyber security thematic funds, which have benefitted from positive momentum in these sectors this year. Our cyber security allocation is up 17.8% year-to-date, with tech up 40.4% in sterling terms.