As with many companies in the tech world, the video games industry has suffered from slowing consumer demand after an economically challenging year. In November 2022, Games Industry.biz reported that the global games market was expected to decline 4.3% during the year, generating $184.4 billion.

In addition to macroeconomic headwinds, the decline stemmed from 2022 being a "corrective year" after two years of the pandemic when the industry boomed. For instance, despite the 4.3% decline, the forecast was still higher than pre-pandemic estimations. As a result, multiple gaming stocks have started 2023 on sale, with bright outlooks over the long term.

Here are three top gaming stocks that are screaming buys this February. 

1. Advanced Micro Devices

After a year when Advanced Micro Devices's (AMD 1.48%) stock fell 55%, the tech giant has been rallying investors since Jan. 1. Its stock is up 30% year to date, with a better-than-expected quarter making Wall Street optimistic for the company's outlook.

In 2022, AMD suffered from steep declines in the PC market as the graphics processing unit (GPU) industry shipped 42% fewer devices than the year before. However, while AMD experienced a drop in sales from PC gamers, its position in console gaming continued to pay off. The company exclusively provides the graphics and processing power with its system on a chip to Sony's PlayStation 5 and Microsoft's (MSFT -0.13%) Xbox Series X|S consoles. 

The immense success of these consoles has helped offset reduced gaming GPU sales in AMD's gaming segment. In the third quarter of 2022, gaming revenue rose 13% year over year to $1.6 billion. Then in the fourth quarter of 2022, the segment fell 7% year over year to $1.6 billion, with AMD stating its semi-custom products (console chips) had partially made up for less GPU sales. 

Sony and Microsoft are expected to release beefier versions of the PS5 and Xbox Series X|S within the next one to two years like they did last generation with PS4 Pro and Xbox One X. As a result, AMD is positioned to profit from consumers upgrading their gaming machines in the near future, making the company's shares a compelling buy this February.

2. Microsoft 

As the home of the Xbox, Microsoft's stock is a no-brainer gaming investment. The brand has given the company the fourth-largest market share in video games after Tencent, Sony, and Apple, with the potential acquisition of Activision Blizzard later this year, making it the third-largest company in the industry.

Microsoft's gaming earnings suffered in its most recent quarter, with Xbox revenue decreasing 13% year over year, primarily owing to declines in content launches. However, the segment's long-term growth is more impressive. Since 2017, Microsoft's gaming segment has grown 79% from $9 billion to $16.2 billion in 2022.

The growth has mainly stemmed from the launch of Xbox Game Pass in 2017, Microsoft's subscription-based service, sometimes referred to as Netflix for games. The platform's membership has more than doubled since 2020, growing from 10 million to 25 million subscribers in 2022. As with most subscription services, Xbox Game Pass provides attractive profit margins and creates a compelling reason for gamers to choose Xbox consoles over competitors, with its low monthly fee and library of popular titles adding value to the console. 

With promising long-term growth and being one of the biggest names in the industry, Microsoft is a must-buy gaming stock this month. 

3. Take-Two Interactive 

While the previous stocks play crucial roles in gaming hardware, this company is one of the most successful game developers in history. Game franchises such as Grand Theft Auto, Red Dead, Borderlands, and NBA 2K, have elevated Take-Two Interactive (TTWO -0.21%) to become the 10th-largest game company and fourth-largest developer.

The crown jewel of the business is undoubtedly Grand Theft Auto V (GTA V), with the game hitting $7.68 billion in revenue since it launched in 2013. In fact, in 2018, GTA V became the highest-grossing single entertainment product in history, more than any other game or movie ever. The popular title has done this with regular updates and microtransactions in the game's online portion.

Last year, Take-Two officially confirmed the next GTA game was in development, skyrocketing anticipation after no new GTA title has been released since 2013. While there is no confirmed launch date for the game, MoffettNathanson analyst Clay Griffin upgraded the company's stock on Jan. 27 and set a price target of $140, a 25% increase. Griffin expects "major announcements right around the corner," with the next GTA and multiple other popular titles due for sequels.

Take-Two's stock plunged 41% throughout 2022, affected by a sell-off and the unpopular acquisition of mobile games company Zynga. However, Take-Two has a promising long-term outlook. Its stock has risen 788% in the last decade and will likely keep growing well into the future. With exciting developments ahead, February is the perfect time to invest in this gaming giant.