GameStop Expands Mobile Push with Popular App Kongregrate Arcade Upgrade

September 30th, 2011 by Trefis Team
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GME: GameStop logo
GME
GameStop
GameStop

Source : Android Market

America’s leading video game retailer GameStop (NYSE:GME) recently launched the upgraded version of their popular mobile gaming app Kongregate Arcade. [1] The new Kongregate Arcade 2.0 comes loaded with powerful social features such as challenging friends to compete in games, viewing real-time score comparisons, messaging friends etc. We believe this move comes in line with GameStop’s strategy to make inroads into the fast booming Android smart phone market. GameStop competes with android game developers like Zynga, Electronic Arts (NASDAQ:ERTS), NGMoco, Gameloft and other independent developers in the mobile gaming space.

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We have a $33.70 price estimate for GameStop stock, which is nearly 40% above the current market price.

GameStop is trying to tap Android gaming market

With the number of smartphones users increasing in an exponential manner, mobile phones have emerged as a serious platform in the video gaming arena. Android is the biggest gainer in this surge, and we expect Android gaming market size to increase as the developers come out with new gaming apps for the OS. According to the recent Nielsen report published on September 26th, U.S. smartphone penetration stood at 43% in August 2011. [2]

Accordingly Android is leading with a 56% market share in three months recent acquirers. [3] All these data point that Android is all set to become the next big thing in video gaming market, and this is precisely the reason behind the launch of new Kongregate Arcade. GameStop has also linked PowerUp Rewards with Kongregate Arcade 2.0 to leverage the gaming app amongst its 13 million PowerUp Rewards members.

Kongregate Arcade 2.0 enjoys a high 4.6 rating on Android Market, [4] however how much the company will benefit from its latest mobile app is a thing to watch out till GameStop’s next quarterly results.

See our complete analysis of GameStop

Notes:
  1. Gamestop launches Kongregate Arcade 2.0, Source: GameStop IR, September 21st [↩]
  2. U.S. smartphone penetration, Source: nielsenwire, September 26th [↩]
  3. Anroid market share in U.S. smart phones, Source: Nielsenwire, September 26th [↩]
  4. Kongregate Arcade on Android Market, Source : Android Market [↩]