Kathryn Ullrich
Managing Partner; DHR Technology Committee
The video gaming industry is experiencing tremendous growth, driven by innovation, shifting consumer behaviors, and a dynamic regulatory environment. As we navigate 2025, several key trends are emerging that will shape the future of interactive entertainment and create new challenges and opportunities for industry leaders.
The one constant is the industry’s pervasive growth and its strong influence on consumers. U.S. consumers spent $58.7 billion on video games in 2024, a 106% increase over the past decade, according to the Entertainment Software Association.
Here’s what we saw in 2024 and what leaders should anticipate in the years ahead:
Past Trends
Consolidation and Strategic Acquisitions:
Gaming M&A grew 39% to $27.3 billion across 967 transactions in 2024(1). Microsoft’s $68.7 billion purchase of Activision Blizzard was the largest in industry history.
Tips for Leaders
Leaders need to have a strategic M&A mindset and industry connections to navigate the complexities of the new competitive landscape.
Regulatory Challenges and Antitrust Scrutiny:
The gaming industry faced increased scrutiny, particularly regarding app store practices and corporate governance.
- Epic Games’ legal battle against Google resulted in the Play Store being deemed an illegal monopoly. An appeal is pending.
- The U.S. Department of Justice addressed potential antitrust issues involving Tencent’s minority stakes in Epic Games and Riot Games.
Tips for Leaders
Leaders need to understand the ever-evolving regulatory landscape and business implications.
Future Outlook
Market Expansion:
In 2025 and the years ahead, several segments of the video game industry are projected to experience significant growth.
- MOBILE GAMING: Projected to reach $192.91 billion by 2033 (13.4% CAGR)(2).
- PC AND CONSOLE GAMING: Expected 15% growth from $72 to $83 billion by 2028(3).
- VIRTUAL REALITY AND AUGMENTED REALITY: Enhancing user engagement and attracting diverse audiences.
Tips for Leaders
Leaders must develop go-to-market strategies that drive global expansion, using emerging technologies while adapting to regional market trends and consumer behaviors.
Artificial Intelligence (AI) and Creative Excellence:
AI boosts creativity and efficiency, enabling richer gaming experiences. The challenge is integrating AI while preserving human artistry.
Tips for Leaders
Leaders will need to balance AI integration with human creativity and respect intellectual property rights.
Intellectual Property (IP):
As AI reduces game development barriers, IP becomes the primary differentiator for publishers. Microsoft’s Activision Blizzard acquisition secured valuable franchises, extending beyond games into other media.
Tips for Leaders
Leaders must prioritize intellectual property as their key competitive advantage and market differentiator as AI makes game development more accessible.
Economic Benefits and Employment Trends:
The U.S. video game industry has a significant economic footprint, supporting and creating over 350,000 jobs and contributing more than $101 billion to the economy(4).
Tips for Leaders
Leaders must identify job candidates who have both technical expertise and strategic foresight, while promoting resilience, building agile teams that can adapt to industry shifts and drive innovation.
Planning Your Next Future Ready Leaders
The rapidly evolving interactive entertainment industry requires leaders who can anticipate market shifts, embrace emerging technologies, and drive innovation. At DHR Global, we see a growing need for leaders who blend creative vision with business acumen – navigating disruption while staying ahead of the competition. Leaders also need agility to adapt to regulatory changes, rethink distribution strategies, and seize new opportunities. Those who do will shape the future of interactive entertainment.
Meet the Experts
References:
(1) Dean Takahashi, “Drake Star: Gaming deals grew 39% to $27.3B in 2024,” VentureBeat, January 15, 2025, https://venturebeat.com/games/drake-star-gaming-deals-grew-39-to-27-3b-in-2024/
(2) “United States Video Game Market Size, Share & Growth Analysis Report By Game Type, By Device Type And Forecast, 2023 – 2033,” Yahoo Finance, May 21, 2023, https://finance.yahoo.com/news/united-states-video-game-market-104100816.html
(3) DFC Intelligence, “PC and Console Game Software Market Forecast 2024-2028”
(4) Entertainment Software Association (ESA), “2023 Essential Facts About the Video Game Industry.