(Reuters) - Shares of Electronic Arts Inc jumped 8.5 percent on Tuesday after the videogame maker said it signed up 25 million players for its new battle royale game “Apex Legends” in a week, setting it up for a showdown with Epic Games’ wildly popular “Fortnite”.
EA is hoping to reproduce the success of “Fortnite”, which blends the “The Hunger Games” movie trilogy and “Minecraft” video game and has developed a huge following with teenagers and older gamers.
EA owns iconic games such as “FIFA”, “Need for Speed” and “Battlefield” and launched “Apex Legends” last week in efforts to attract new audiences and take advantage of the popularity of the battle royale format, where dozens of online players battle each other to the death.
“Apex Legends” signed up 10 million players within three days of its launch, EA said last week, a milestone that Fortnite took two weeks to reach. EA disclosed the new number on Monday on Twitter.
While the initial numbers mark a victory for EA, the company still has a long way to go to match Fortnite’s more than 200 million subscribers.
As of Friday, “Apex Legends” was the most viewed on gaming live-streaming network Twitch.
“(Electronic Arts’) topsy-turvey CY19 took a decidedly positive turn last Friday when they announced ‘Apex Legends’,” Bernstein analysts said, raising their price target on the stock by $29 to $120 - well above the median Wall Street target of $95.
“Apex Legends’ stunning success should also greatly reduce the frustration with management sometimes expressed by investors,” the analysts said, adding that “Fortnite” took three months to reach 30 million users.
Analysts from Baird said that the update should provide investors with better visibility that “Apex Legends” could be a “meaningful hit” for EA over the coming year.
The news comes almost a week after the company lowered its yearly revenue projections following weak sales of its “Battlefield V” title, that had sent its stock plunging 18 percent.
After a 9.6 percent surge on intraday on Monday, the stock ended slightly lower at $97.24.
Activision Blizzard was marginally up ahead of its quarterly results, which are due after the bell.
Reporting by Akanksha Rana in Bengaluru; Editing by Saumyadeb Chakrabarty