Sony ‘significantly overpaid’ for Bungie out of ‘despair’, says analyst Michael Pachter


Wedbush Securities analyst Michael Pachter has commented on the gaming industry for years, usually drawing angry reactions from fans of one brand or another. Anyway, he’s back again, and this time he’s got a pretty strong opinion about Sony’s recent $3.6 billion buyout of Bungie.

Essentially, Pachter believes the acquisition is because Sony is trying to keep up with an ever-changing industry. “I think Sony just made a statement and said that we are not going to be left behind. So we will buy Bungie,” he said.

Pachter continues:

Just for comparison, EA bought Respawn about three or four years ago for $700 million with 400 developers. Bungie’s revenue is about $200 million. So I think Sony overpaid a lot.

Pachter is approaching this from a revenue standpoint – that’s kind of his job – without taking into account Sony’s potential plans for the future. Bungie may not be making crazy profits right now – relatively speaking – but we know that Sony wants to expand its line of games significantly. Preliminary reports suggest that Bungie will play a major role in establishing PlayStation’s position in this space, but again, Pachter is all about the current numbers.

I think it was a statement that Sony is not going to let Microsoft get ahead of it, so it will just buy something out of desperation.

Microsoft was rumored to be buying Bungie for $2 billion in 2020, but the asking price seemed too high to Microsoft.

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