$50B. That’s apparently what Electronic Arts is worth.

$50B.
That’s apparently what Electronic Arts is worth.

I’m not a banker. But one thing is clear even to me:
𝗜𝗻𝘃𝗲𝘀𝘁𝗼𝗿𝘀 𝗮𝗿𝗲 𝘀𝘁𝗮𝗿𝘁𝗶𝗻𝗴 𝘁𝗼 𝗿𝗲𝗽𝗿𝗶𝗰𝗲 𝗴𝗮𝗺𝗲 𝗽𝘂𝗯𝗹𝗶𝘀𝗵𝗲𝗿𝘀 𝘄𝗶𝘁𝗵 𝗽𝗿𝗲𝗱𝗶𝗰𝘁𝗮𝗯𝗹𝗲 𝗿𝗲𝘃𝗲𝗻𝘂𝗲.

Hit-driven entertainment looks volatile.
Recurring live-service cashflows look durable.
And durability commands a premium.

When cash flows behave more like SaaS than cinema, multiples expand.

Investors will look at publishers with steady cashflow in a new light.
And licensors, from the NFL to Disney, now know exactly how much that stability is worth.

EA’s valuation is a reminder:
Hits get headlines.
Systems get you $50B.