By Felix Richter

If any further proof was needed that Microsoft is taking gaming seriously, the company’s latest acquisition is a definite statement of intent. The Redmond, Washington-based tech giant announced its plans to acquire Activision Blizzard in an all-cash transaction valued at $68.7 billion on Tuesday.

The deal, which is still subject to regulatory review and Activision Blizzard’s shareholder approval, is expected to close in fiscal year 2023 (ending June 30, 2023) and would be Microsoft’s largest acquisition by far. In 2016, the Windows-maker had bought professional social network LinkedIn for $26.2 billion in its biggest acquisition to date. Activision Blizzard is one of the world’s most renowned video game studios and owner of iconic franchises such as Warcraft, Diablo, Call of Duty and Starcraft.

As the following chart shows, Microsoft’s gaming business, which was kickstarted with the release of the first Xbox in 2001, has nearly tripled in size over the past decade. Pushed by large-scale acquisitions, e.g. Minecraft maker Mojang in 2015 and ZeniMax Media in 2021, as well as the 2017 launch of the popular subscription service Xbox Game Pass in 2017, Microsoft’s gaming revenue climbed to $15.4 billion fiscal year 2021. Adding Activision Blizzard to the fold, Microsoft’s gaming business will instantly grow by roughly 50 percent, bringing its annual revenue way past $20 billion.

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