Microsoft Acquires Gaming Giant Bethesda Softworks in $7.5 Billion Deal

On the heels of its latest Xbox hardware announcement, Microsoft is set to acquire ZeniMax Media, parent company to gaming giant Bethesda Softworks. The move comes shortly after Microsoft fell short in its bid to acquire parts of social video app TikTok’s business. 

Microsoft is shelling out $7.5 billion for the maker of top games including “Fallout,” “The Elder Scrolls,” and “Doom.” The deal is Microsoft’s biggest ever in the gaming sector, triple that of its 2014 purchase of “Minecraft” maker Mojang. 

The company, headquartered in Washington, will increase its studio teams from 15 to 23 and add Bethesda’s games to the Xbox Game Pass.

ZeniMax Media was founded in 1999. The acquisition includes over 2,300 employees across publishing offices and development studios Bethesda Softworks, Bethesda Game Studios, id Software, ZeniMax Online Studios, Arkane, MachineGames, Tango Gameworks, Alpha Dog, and Roundhouse Studios. 

Bethesda’s structure and leadership will remain in place in the acquisition, which is expected to close in the second half of fiscal year 2021. 

“Gaming is the most expansive category in the entertainment industry, as people everywhere turn to gaming to connect, socialize and play with their friends,” Microsoft CEO Satya Nadella said in an announcement. “Quality differentiated content is the engine behind the growth and value of Xbox Game Pass — from ‘Minecraft’ to ‘Flight Simulator.’ As a proven game developer and publisher, Bethesda has seen success across every category of games, and together, we will further our ambition to empower the more than three billion gamers worldwide.”

Microsoft’s first console release in seven years is just weeks away. The Xbox Series X and lower-cost Xbox Series S are slated to ship on Nov. 10 after the company’s pricing announcement in early September. 

The video game industry is booming in the United States amid the COVID-19 pandemic. 

Total industry consumer spending on video gaming in the U.S. reached a second quarter record $11.6 billion in 2020, according to a study from the NPD Group, up 30% from the same period last year. Hardware sales alone increased 57%, to $848 million.