What happened

Shares of Enthusiast Gaming Holdings (EGLX -3.51%) were up 18.5% as of 1:05 p.m. ET after the company announced record unique visitor traffic during October. After the gain today, the stock is down 19.9% year to date.

EGLX Chart

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So what

Enthusiast Gaming operates a growing media and content platform for video games and esports fans. It reported revenue growth of 165% year over year in the third quarter, reaching $43.3 million. Most of its revenue comes from selling advertising space across more than 100 websites. Management credited momentum in direct sales (custom content produced by third-party brands) and its recent acquisition of Addicting Games, which has a portfolio of casual games for desktop and mobile devices, for its third-quarter results.

In the context of this momentum, Enthusiast Gaming's growing relevance in the gaming industry is worth watching. Total U.S. unique visitors reached 47.8 million in October based on data from the Comscore Media Metrix, which puts Enthusiast Gaming in second place as the most-visited gaming property, right behind Amazon's Twitch and ahead of Roblox and mobile game creator Zynga

A group of esports gamers playing games on PCs.

Image source: Getty Images.

Now what

CEO Adrian Montgomery said that the growth in traffic validates the platform's popularity with a Gen Z and millennial audience. Montgomery also suggested the company's growth isn't over, as "gaming continues to take a greater share of overall internet traffic." 

The stock has been very volatile over the last year, which is common for small-cap stocks. Some of this volatility can be blamed on the company's string of net losses on the bottom line in recent quarters. Because of that negative mark on the company, less risk tolerant investors may want to look at more established video game stocks to invest in the gaming industry.