For the uninitiated, the battle royale genre, originally popularized by PlayerUnknown's Battlegrounds (PUBG), are video games in which up to 100 players do battle in an effort to be the last person standing, similar to the plot of the 2012 hit movie Hunger Games. When Epic Games released Fortnite last year, the title had mostly positive reviews, but it wasn't until the free-to-play battle royale was introduced several months later that the game really took off.

The surge in popularity of the battle royale genre has created an opportunity for investors to benefit from the craze. Here's why I believe NVIDIA Corporation (NASDAQ:NVDA), Tencent Holdings (NASDAQOTH:TCEHY), and Activision Blizzard (NASDAQ:ATVI) are best positioned to profit from this growing trend.

A screenshot of the video game Fortnite, with an avatar alone in a field.

Image source: Fortnite.

The processor that makes it all possible

NVIDIA may not immediately come to mind as a beneficiary of the Fortnite phenomenon, but the company gains from any increased adoption of gaming, particularly those that call for its industry-leading graphics processing unit (GPU).

In its most recent quarter, NVIDIA's gaming segment grew 66% year over year, making up 54% of the company's $3.2 billion in revenue. Responding to questions about what drove the surprisingly strong performance, NVIDIA's founder and CEO Jen-Hsun Huang credited the growing adoption of the battle royale genre:

As you probably know, Fortnite and PUBG are global phenomena. The success of Fortnite and PUBG are just beyond comprehension, really. Those two games are a combination of Hunger Games and Survivor has just captured imaginations of gamers all over the world. And we saw the uptick and we saw the demand on our GPUs from all over the world.

Huang expects the combination of pent-up demand and new players joining the ranks will continue to invigorate sales.

Brother, can you spare a dime?

China's Tencent may very well be the biggest social media and gaming company you've never heard of, sporting a market cap of nearly $500 billion. Its social messaging service, WeChat, has more than a billion users and mobile gaming is an integral part of the experience. In its most recent quarter, Tencent grew revenue 48% year over year to about $11.7 billion, while profits jumped 61% to about $3.7 billion. 

So how does Tencent stand to gain from the fervor over Fortnite? Simple -- the company owns a 40% stake in Fortnite creator Epic Games, and has developed and recently debuted two similar games in China based on licensed IP from PUBG. Tencent is also seeking government approval to release Fortnite to Chinese gamers.

Since there's no cost for the free-to-play version, Epic Games makes money from the sale of virtual items, such as character costumes and emotes -- emoticons that are used by gamers to express a thought or feeling. Add in the merchandising, and some analysts suggest that Fortnite could generate as much as $2 billion in revenue this year. 

A scene from Call of Duty: Black Ops 4 featuring Ajax avatar.

Image source: Activision Blizzard.

They nearly had a Blackout

Video game publisher Activision Blizzard (NASDAQ:ATVI) is known primarily for its megahit World of Warcraft, but the company actually boasts eight $1 billion franchises in its stable of popular games, including such hits as Overwatch, Call of Duty, and Candy Crush. In its most recent quarter, the company reported record first-quarter revenue, net bookings, and earnings per share of $1.96 billion, $1.38 billion, and $0.65, respectively. 

The company just announced plans to capitalize on the Fortnite frenzy by adding a battle royale mode -- called Blackout -- to Call of Duty: Black Ops 4, which is scheduled to debut in October. In a press release, Activision said: "Blackout, where the Black Ops universe comes to life in a massive battle royale experience featuring iconic characters and locations from all four Black Ops games in a one-of-a-kind offering that is uniquely Black Ops." 

Activision is one of the first major game publishers to announce a battle royale mode for an existing franchise. While there is no way to know for sure how this strategy will play out, the company could be enticing new players to Call of Duty, while providing incentives for current gamers to stay.

The small print

It's important to note that investors shouldn't buy any stock based on its exposure to the battle royale genre. While there is strong demand now, it may turn out to be a fad -- does Pokemon Go ring any bells? On the other hand, it could be the next Minecraft. While each of these companies will benefit from the popularity of Fortnite and other last-person-standing games, they also have existing businesses with strong growth, and any benefit derived from this emerging trend, however long- or short-lived, is just a bonus.

Danny Vena owns shares of Activision Blizzard and Nvidia. The Motley Fool owns shares of and recommends Activision Blizzard, Nvidia, and Tencent Holdings. The Motley Fool has a disclosure policy.