Amazon Delays Online Game New World- Again

Amazon.com Inc. (AMZN) has announced that it will delay the release of its upcoming online game, New World, as a result of user feedback.

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New World is a massive multiplayer online (MMO) video game that was previously delayed in June as a result of the COVID-19 pandemic. The latest delay was attributed to gameplay issues from gamers.

“We want our players to feel completely immersed in the game, and know that our studio stands for quality and lasting gameplay you can trust and that means added time to get things where we want them before we fully release, ” said Amazon Games Studio Director Rich Lawrence in a July 10 blog post.

The news follows the recent delay of Amazon’s other video game, Crucible, which was pulled back to closed-beta testing following a critical reception from gamers. Crucible is a third-person shooter for console that is also an online game.

Online games take longer to develop due to the inherent nature of the game not supporting any type of offline gameplay. However, MMO games boost a more lucrative opportunity for publishers if they can capture their target audience with an endless amount of expansions, updates, and in-game purchasing options for its immersive worlds. Amazon’s two delayed games leverage the online component while being made exclusively for console. A majority of the company’s games have been for the mobile platform.

Amazon Game Studios has struggled to make inroads in the console market with only one previous game release in 2019 called, “The Grand Tour Game.” The game received a cool reception and was eventually delisted from console stores. Last year, the company laid off dozens of employees and canceled other games that were not made public.

In a statement to Geekwire, an Amazon spokesperson said on June 14, 2019, “Amazon Game Studios is reorganizing some of our teams to allow us to prioritize development of New World, Crucible.” The company added, “Amazon is deeply committed to games and continues to invest heavily in Amazon Game Studios, Twitch, Twitch Prime, AWS, our retail businesses, and other areas within Amazon.”

In 2014, Amazon purchased the popular game streaming Twitch for nearly $1 billion bringing in millions of gamers under its umbrella.

Needham analyst Laura Martin said on June 25, “Although we are most excited about advertising as a revenue diversification tool and upside profit driver for AMZN, Twitch is the most undervalued asset inside AMZN’s empire because it extends AMZN’s reach into the next generation of purchasers.” She reiterated a Buy rating on Amazon’s stock and a price target of $3,200.

Likewise, Citigroup analyst Jason Bazinet maintained a Buy rating on the stock on July 10. He raised the price target from $2,700 to $3,500 implying an upside potential of 11%. He noted that Amazon is “one of the most compelling stocks we cover.”

Amazon stock is up 73% year-to-date with a Strong Buy analyst consensus that breaks down into 38 Buy ratings versus 2 Hold ratings and 1 Sell rating. The $2,879 average price target suggests 10% downside potential for the shares in the coming 12 months. (See Amazon’s stock analysis on TipRanks).