Business for mobile-game company Zynga (NASDAQ:ZNGA) is booming more than ever. In 2020, the company generated nearly $2 billion in revenue -- an all-time high. And the good times keep rolling in 2021, with revenue up another 64% through the first half of the year.
As great as Zynga's results have been, other video game companies are also showing how powerful mobile games can be. In this video from Motley Fool Backstage Pass, recorded on Oct. 18, Fool analyst Sanmeet Deo and contributor Jon Quast talk about Pokémon Go and how this single game is roughly half the size of Zynga's entire business.
Sanmeet Deo: Mobile gaming. So, the U.S. mobile gaming market exceeded $2 billion dollars in consumer spending in eight of the nine months of 2021 to date, including September. Average monthly spending is approximately 28% higher than that experienced in the first nine months of 2020. Monthly spending on mobile gaming is quite strong when everyone thought last year was the peak, we're all at home. I feel like last year basically, with a lot of things it unleashed the power of mobile gaming and the interest and the awareness and the exposure to it and because of that, it's riding this wave and it could slow down, no doubt, as a lot of things that were benefited by the pandemic at some point will, but it's cool to see that these trends are going much higher.
I think another thing, September strong performances saying for the mobile games market was buoyed by the second-highest earnings title of miHoYo's Genshin Impact, which marks its one-year launch anniversary with spending of nearly 120% month overmonth. That's huge. That was a big one that drove that. Top performing overtime is the US. By consumer spending in September included Candy Crush Saga, Genshin Impact, excuse me if I said that wrong, Roblox, Coin Master, and a whole bunch of others, Clash of Clans, Candy Crush Soda Saga, and Pokémon Go. Jon, did you have some information or some news on Pokémon Go?
Jon Quast: Yes, I do and I didn't know if we're going to have time to do this. So that's really exciting for me. Let me just get set up here. While I'm pulling this up, I did want to mention that we had questions on Nintendo's affiliation with Pokémon. I did look it up here before the show. Nintendo does not own Pokémon outright, they own 32% of the voting power as of the end of 2020. It is important for Nintendo in some regards, however, Pokémon Go is not made by Nintendo, it's made by a company called, oh, what is the name of it? Nutanix. Excuse me, I've forgotten the name. [Editor's note: The name is Niantic.]
In any case, Pokémon Go. This is a recent article from The Ringer. Pokémon Go monthly active users grew 15% through the first five months of this year, 2021, while spending spiked 49%. According to the top app analyst Sensor Tower, the firm also says that 2020 was the game's most profitable year yet.
Are you still there?
Deo: Yeah, I can hear you.
Quast: There we go [laughs]. What's really interesting about this new data from Pokémon Go is that it said that it generated revenue over $1 billion dollars in 2020.
Now, let me put this into perspective. Zynga, which is publicly traded, Z-N-G-A pure-play on mobile gamings, many mobile game franchises, they had just under $2 billion in revenue last year. This one app alone, Pokémon Go would be half of Zynga's business.
It's five years old now. Still incredibly popular, growing in popularity once again, especially now that people are able to start going outside again. So they just had their first live event since the pandemic. It was in Liverpool, England, and it's these things called Safaris. Basically you go to these events and the Pokémon game will unlock new Pokémon characters, variations on the characters -- ticketed events. People are actually spending between $12 and $18 to attend these events so that they can capture the new Pokémon and the variations of the Pokémon.
Roughly 700 Pokémon have been released so far on Pokémon Go, there's over 900 total. The company hasn't even released all of the total Pokémon out there yet. They are staggering it so that they can keep this game going.
They think that they got in the bag for sure five more years of strong Pokémon Go. But they really think that they could even extend this to 10 or 15 years with everything that they have in the development pipeline for Pokémon Go. Really interesting when you see how strong this game is five years in.
Deo: Wow, that's amazing. Amazing stat. It's interesting because it shows and we are talking about how overall all of the video game industry has been growing as we saw in the September data. Mobile gaming for this year versus last year has been growing quite strongly and mobile is a faster segment of growth in the gaming industry as it is so that's been impressive.
But Pokémon Go, it's interesting you said it and the first thing that came on my mind is don't short change any of these gaming companies because just because we're out and doing stuff and not sitting at home all day, for mobile games, we take our gaming system with us everywhere we go and even the Switch, you can take with you. It's almost a mobile platform as well. Playstation 5 and Xbox, I don't think you can take those. You could take them physically and then you put them in a TV obviously.
But things like Pokémon Go, we can be doing these different games and experiences wherever we're at and it can even integrate with our life outside of just the home and post quarantine or pandemic life where we're out and doing things. Just an example of the convergence too of gaming, virtual-reality, metaverse like that whole thing that we talked about, I'm probably going to be a broken record when I talk about it here on our weekly segments. But I see it's very bullish for mobile gaming and that whole area.