Amazon is not expected to make a bid for Electronic Arts, and it canceled an earlier report that the internet giant would make a bid today for the video game publisher, according to a Reuters report.
EA shares jumped 15% in pre-market trading after a report from USA Today regarding Amazon's takeover bid for the game owner FIFA and Apex Legends ( Apex Legends). The stock rose 4% in early trading, giving the company a market valuation of more than $37 billion.
Amazon and EA said they do not comment on rumors and speculation of mergers and acquisitions.
Amazon, which has about $37 billion in capital, has been in the process of acquiring companies to diversify its business beyond e-commerce and cloud technology under the leadership of new CEO Andy Gacy.
The company earlier this August offered to buy iRobot Corp., the maker of the Roomba robotic vacuum cleaner, for $1.7 billion, just weeks after agreeing to acquire primary care provider One Medical ( One Medical) for $3.5 billion.
Amazon, which owns live video game streaming platform Twitch, also bought MGM Studios, maker of the Rocky and James Bond films, for $8.5 billion. .
EA's strong licenses, intellectual property rights and the ability to build new games in the metaverse make it an attractive option for tech giants looking to capture the attention of younger audiences, analysts said.
The bet on metavirus backed Microsoft's $68.7 billion deal to EA rival and Call of Duty maker Activision Blizzard in January.
The new deals are also blurring the line between PC and mobile gaming companies, and come on the back of a faltering global gaming industry where demand, fueled by the pandemic over the past two years, has waned.
Data from research firm Newzoo showed that the global gaming market is expected to grow just 2% in 2022 compared to last year, a far cry from the 23% growth recorded in 2020.
EA had forecast lackluster sales numbers, saying it was not "totally immune" from the recession, and its shares had lost about 3 percent as of Thursday's close, compared to a nearly 30 percent drop for Take-Two.