It’s a Big Year for Videogames. EA and Battlefield 6 Are the Next Winners.

Battlefield 6, from Electronic Arts, is slated to launch in early October. (Courtesy EA)

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War Games. Hi everyone. Videogames are a passion of mine. For whatever reason, the business often brings out cynicism and pessimism from Wall Street, which has generally made the sector a fertile area for investment opportunities.

Gaming is an area where expertise about history matters—and I’ve been following the sector for decades. In this column, I’ve predicted the blockbuster success of Hogwarts Legacy, the fading relevance of Microsoft Xbox and the gains for Sony’s PlayStation 5 console platform, and the strong prospects for the Nintendo Switch 2 console amid plenty of skepticism.

Nintendo launched the Switch 2 in early June, and it became the fastest-selling console of all time, driving the company’s U.S. shares up 64% this year. Last week, Sony blew away profit estimates based on the strength of its PlayStation 5, driving its stock to multidecade highs and up 32% this year. Console gaming is now Sony’s most important business.

What’s next? From here, I believe the best opportunity in videogames comes from Electronic Arts thanks to the potential of its first-person military shooter game Battlefield 6, which is slated to launch in early October. The game is a direct competitor to Call of Duty, now owned by Microsoft after it acquired Activision Blizzard for roughly $70 billion in 2023. According to research firm Circana, Call of Duty has been the best-selling videogame franchise in the U.S. for 16 consecutive years.

This year may break the trend. Last weekend, EA offered its first public beta of Battlefield 6 to gamers on the PC, PS5, and Xbox. It was extremely well received by the gamer community, which lauded the title’s tight gameplay, improved graphics, and map design. I was similarly impressed and spent many hours sneaking behind enemy lines and flanking opponents. As a Battlefield veteran, this is the most fun I’ve had since the original Battlefield 1942 more than two decades ago.

I wasn’t alone in playing the game. At times, the online queue to play reached over a hundred thousand players due to EA’s limited server capacity. Over 500,000 gamers joined at once on the PC Steam digital store platform, which broke Call of Duty’s prior record for concurrent players.

When the beta ended on Sunday, my social media feeds started to fill up with pleas asking EA to reopen its Battlefield 6 servers with funny memes suggesting the publisher could collect all the data it wanted from their computers.

Battlefield is the first title developed under the leadership of EA executive Vince Zampella, who was responsible for the creation of three multibillion-dollar franchises, including the original Call of Duty and Modern Warfare, along with Apex Legends.

No one has a better record at making these types of games.

When I asked Zampella three years ago about the secret to his success, he said, we “iterate and really try to hone in on what’s fun. That’s what it is all about. It’s not the best idea that wins, it is the best execution that wins.”

EA is in the driver’s seat given the fading excitement around Call of Duty. Many gamers have complained about the lack of innovation in its annual releases. They don’t like the monetization of the games—including the selling of digital costumes based on cartoon characters or rappers, especially as Battlefield maintains a serious aesthetic.

EA will also benefit from the delay of Take-Two Interactive’s Grand Theft Auto VI, which was originally slated to come out this fall but has been pushed back to next year. It’s the perfect setup for Battlefield 6 to take even more share against other games this holiday.

Investors have begun to pick up on the good news around EA. The stock is up 18% this month, but there’s still plenty of upside. The shares trade at a reasonable 22 times expected earnings for the company’s current fiscal year ending in March 2026.

That outlook is based on Wall Street estimates for EA to sell eight million to 11.5 million units of Battlefield 6 this fiscal year. I think the game can double those figures, taking material market share from Call of Duty this holiday. And that would mean earnings upside this year, pushing EA’s stock price far higher.

After the beta, Mike Ybarra, a well-respected former Microsoft Xbox and former Activision Blizzard executive flatly wrote, “Battlefield will boot stomp CoD this year.”

It’s great news for EA shareholders.

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Write to Tae Kim at tae.kim@barrons.com or follow him on X at @firstadopter.