When most people think about gaming, they think of computers or consoles like the Sony PlayStation or Microsoft Xbox.

But mobile games -- the kind you play on your smartphone or tablet -- have quietly grown to make up the majority of gaming industry revenue. They're expected to generate $90.7 billion of the industry's $175.8 billion of total revenue in 2021. 

Sea Limited (NYSE:SE) attracts over 729 million users to its games each quarter, and Skillz (NYSE:SKLZ) has built a new platform for game developers to monetize their products. Here's why you should own them. 

A happy family sitting on the couch viewing a tablet device.

Image source: Getty Images.

1. The case for Sea Limited

This company's success in the mobile gaming space is driven by its Free Fire battle royal offering, which surpassed 1 billion downloads earlier this year and clocked a record-high 150 million daily active users. Despite having been released back in 2017, the game is clearly still growing in popularity.

In the third quarter, the most recent, 93.2 million of Sea Limited's 729 million quarterly active gamers were paid users, and they contributed $1.2 billion to the company's revenue. And on a trailing-12-month basis, the gaming segment has generated $4.5 billion in revenue, which represents 69% growth compared to the previous 12 months.

But this company does far more than just gaming, which is an added bonus for investors. It has a booming e-commerce app called Shopee, which is ranked No. 1 in Alphabet's Google Play store globally for time spent in the app in the shopping category.

It also has a fast-growing fintech business that offers digital wallets to consumers, and in Q3 it had over 39 million quarterly active users, who made $4.6 billion in transactions.

Analysts expect the combination of Sea Limited's three segments to generate $9.2 billion in revenue for full-year 2021, representing 101% growth compared to 2020. It was only in 2018 that the company crossed $1 billion in yearly revenue for the first time, so its growth has been lightning quick. 

Investors have certainly noticed, and they have sent the stock 1,800% higher since its public listing in 2017. But in 2022, Sea Limited is on track to enter 11-figure territory with $13 billion in expected revenue, in yet another milestone -- so if you don't own it yet, now might be the time. 

A group of three smiling friends playing games on their smartphones.

Image source: Getty Images.

2. The case for Skillz

Unlike Sea Limited, Skillz doesn't actually develop any games itself. It's a platform for developers who want to monetize their games but aren't getting much traction through mainstream channels.

It's a startling statistic, but only 2% of game developers manage to bring a successful product to market, so most independent studios never achieve profitability. Skillz seeks to solve this problem by offering a different approach. Users come to its platform and pay money to enter competitive tournaments to win cash prizes, with both Skillz and the developer getting a piece of the action. 

It means a particular game no longer needs to be exceedingly popular in order to generate revenue, and the data shows developers are experiencing fourfold revenue growth after adding their games to Skillz. And players are spending twice as much time on the platform as the gaming industry average, so they're loving it, too. 

With just one quarter remaining in 2021, the company looks set to meet analyst expectations by delivering $389 million in revenue for the year, which would represent 80% compound annual growth since 2019. It's one reason Wall Street loves the stock, with an average price target of $16.57 -- or 59% up from here. But the street-high target is at $25, an eye-popping 140% higher than today's price. 

Skillz secured a deal with the NFL earlier this year to run a competition among game developers, who will battle to produce a football-themed mobile game. It's a big milestone for the company in its quest to support more mainstream games on its platform. 

With the backing of Wall Street, strong financial performance, and high-profile deals, this stock could supercharge your portfolio over the long run. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.