As of 2025 the global video game industry is estimated to be worth $250 billion dollars. And some experts think that this value could triple within the next ten years. Whereas back in the 90s it was estimated to be worth only $30 billion dollars. This massive increase is a testament to just how powerful and popular video games have become.

Arcades used to be the cornerstone of the industry’s success. Before the era of home consoles and PC gaming. All the latest gaming titles were launched at arcades. In our opinion arcades were the perfect representation of what gaming is all about. The blending of the artistic medium of game design paired with the social atmosphere propagated by being at an arcade. And, back in the day, arcades were extremely profitable.

But the era of arcades is long gone now. Especially now that online gaming is so advanced. But just because they aren’t as popular as they once were, doesn’t mean there isn’t still a market for them. Which leads us onto today’s topic. Are arcades still a profitable investment?

Logistics Of An Arcade

As with any business the first thing we have to look at is the expenditures associated with running an arcade. This is important information to have even if you are only looking at investing in someone else’s arcade venture.

The primary expenses will be the game machines and electricity costs. Arcades will naturally rack up a higher electricity bill than most businesses. And if there isn’t enough demand in the area for an arcade then this could potentially lead to profits dipping off quickly. But in a high demand area the electricity costs are negligible.

When it comes to the games there are two options. An arcade can choose to either buy the machines or partner with a games company. There are advantages to both methods. If the arcade machines are provided by a company then the arcade will only take a share of the machine profits. But they don’t have to worry about maintenance costs and will regularly get new machines brought in. This is useful for generating business hype and enticing return custom. Whereas owning the machines will provide more profits. A smart arcade owner should opt for a mix of owned and rented machines.

One of the main sources of income for a traditional arcade won’t actually come from the machines. Instead it will be generated from things like merchandise, food, drinks, and membership deals. Of course all of these income streams will also have a cost associated with them.

Then you need to consider the costs for things such as site maintenance, staffing, and emergency situations. Arcades can sometimes become hotspots for pests. Even though hiring a pest control company isn’t that expensive these days, it is still something to consider. Insurance is absolutely essential for arcades. And has the potential to be one of the biggest costs associated with running the business.

Is There Demand?

We briefly touched on the idea of demand. And this is the most important question to look at when deciding if you should invest in an arcade. Is there even demand for them anymore? Well you will be happy to know that demand for arcades has been steadily increasing over the last few years. Ever since the end of the Covid-19 pandemic, gamers are looking for a more engaged social gaming experience. Moving away from the isolated feeling of home gaming.

The arcade resurgence has been further fueled with the advent of VR gaming technology. VR arcades are starting to pop up all over the place. They offer an immersive gaming experience that people can’t replicate at home without a significant financial investment. And the running costs of VR arcades is comparatively low when compared to how much money they can bring in every month.

But let’s look at some numbers. Experts have claimed that the arcade industry is seeing significant growth. They expect revenue for the industry to reach almost $6 million dollars within the next five years. It is estimated that an arcade in a high demand area can potentially bring in up to $2,000 dollars in profit a week. This is no small feat for an industry that was said to be on the brink of collapse not even ten years ago.

Is It A Profitable Investment

So are arcades a profitable investment? We should say it is a resounding yes! As gaming technology improves, especially in the world of VR, the arcade industry is only going to get stronger. And with eSports growing in popularity too we are starting to see more PC gaming arcades open up.

Now is the time to break into this industry. Not only is it potentially lucrative but it is also a great way to diversify your investment portfolio. And it can potentially open you up to new and exciting investment opportunities in the years to come.