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:
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.
Leaders need to have a strategic M&A mindset and industry connections to navigate the complexities of the new competitive landscape.
The gaming industry faced increased scrutiny, particularly regarding app store practices and corporate governance.
Leaders need to understand the ever-evolving regulatory landscape and business implications.
In 2025 and the years ahead, several segments of the video game industry are projected to experience significant growth.
Leaders must develop go-to-market strategies that drive global expansion, using emerging technologies while adapting to regional market trends and consumer behaviors.
AI boosts creativity and efficiency, enabling richer gaming experiences. The challenge is integrating AI while preserving human artistry.
Leaders will need to balance AI integration with human creativity and respect intellectual property rights.
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.
Leaders must prioritize intellectual property as their key competitive advantage and market differentiator as AI makes game development more accessible.
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).
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.
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.
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.