MTG expects more than 40 percent esports sales growth for the rest of 2017

Lots of esports events and new commercial agreements are the main driver.

Photo by Helena Kristiansson via ESL

Modern Times Group, parent company to ESL and DreamHack, made some bold predictions for the growth of its esports business in its latest quarterly report.

While its esports and games offshoot, MTGx, still represents only a small fraction of the company’s business, MTG CEO Jørgen Madsen Lindemann expects the section to deliver its first quarterly profit in the fourth quarter of this year.

The Swedish media company estimates more than 40 percent organic esports sales growth for the second half of the year, mainly due to running bigger esports events more frequently in the next few months. The company has also signed commercial agreements with Intel, Facebook, and Twitter, amongst others.

Related: Intel signs on as global technical partner for ESL, announces $1 million Intel Grand Slam

Other than last year, when ESL and DreamHack events were evenly scheduled throughout the year, in 2017, many big events, festivals, and league finals take place in the second half of the year. July to December will see the company stage six DreamHack events, two IEM events and three ESL One stops.

Two major acquisition strained MTG’s figures this quarter, though. MTG concluded the full consolidation of German games studio, InnoGames, and bought US games developer Kongregate. In the first quarter of 2017, MTG had reported record sales and called esports the field with the company’s “highest levels of growth.”

ESL, MTG’s biggest asset, recently made headlines with staff layoffs as well as executive hires. By the end of last month, ESL had notified a number of employees of their impeding termination, according to a Slingshot Esports report. In order to “realign resources and expand its organization,” ESL wants to cut five percent of its global workforce, mainly in event operations and executive TV production.

Last week, ESL announced the addition of two executive hires from Vodafone and Zalando Media as chief marketing and chief revenue officers. Generally speaking, both, the executive hires as well as the staff layoffs are indicative that ESL is restructuring its business. How that exactly might turn out in the end, remains to be seen, however.

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