If you’ve ever marveled at the breathtaking visuals of a game, there’s a good chance Winking Studios (SGX: WKS) played a role in creating them. This Singapore-based company has quietly grown into a global powerhouse in gaming art outsourcing, earning its reputation as the go-to partner for top game developers. For investors, Winking Studios represents a dynamic opportunity in a rapidly expanding industry.

Humble Beginnings and Rapid Growth

Winking Studios was founded in 2003 with a simple yet ambitious goal: to support game developers with high-quality art outsourcing services. Starting with a small team focused on 2D and 3D art, the studio quickly earned the trust of industry leaders. Fast forward to today, and Winking Studios employs over 800 professionals across nine locations, including Kuala Lumpur, Taipei, Shanghai, and Nanjing.

Over the years, the company has achieved notable milestones, from developing award-winning games like X.A.O.C. to topping VR game sales charts with Unearthing Mars. Dual-listed on the London and Singapore Stock Exchanges (Ticker: WKS), Winking Studios now serves 22 of the top 25 game publishers worldwide, offering a full suite of services ranging from character design to animation.

The financial results of its business model are compelling. In the first half of 2024, Winking Studios reported a 7.1% revenue growth, reaching USD 15.23 million. Japan became a standout market, with orders nearly tripling due to a strong focus on business development. Furthermore, the company maintains a strong balance sheet, with no debt and substantial cash reserves to fuel further acquisitions and growth.

M&A - A Proven Strategy for Growth

Winking Studios has consistently expanded its capabilities through strategic acquisitions. In 2024, the company acquired On Point Creative in Taiwan and Pixelline Production in Malaysia, strengthening its foothold in Asia. Most recently, in January 2025, Winking announced its largest acquisition yet: Shanghai Mineloader Digital Technology Co., Ltd., valued at approximately RMB 146 million (USD 24.5 million upfront). This deal will add over 460 skilled professionals and deepen Winking’s expertise in console gaming.

This M&A playbook is similar to Keywords Studios, who was acquired in a 2.2 billion pounds deal by EQT (with Temasek being a co-partner).

Adding to its appeal for investors, Winking Studios aims to distribute 5% to 15% of its annual profits as dividends.

Why Investors Should Take Note

According to market statistics, the global gaming industry is booming, projected to reach USD 317.6 billion by 2027, where the market value is worth more than that of the music and movies market value combined. As a leader in game art outsourcing, Winking Studios is strategically positioned to ride this wave. Here are key reasons investors should consider Winking Studios:

1. Established Market Presence: Serving 22 of the top 25 game publishers worldwide with more than 20 years of track record
2. Innovative Edge: Investments in AI-driven tools in gaming services to enhance efficiency and output quality, providing a competitive edge.
3. Dividend Reliability: Aims to distribute 5% to 15% of its annual profits as dividends..
4. Diversified Revenue Streams: With expertise in both online and console games and a diversified market presence, Winking mitigates risks tied to reliance on a single segment.
5. Dual Listings: The company’s presence on the London and Singapore stock exchanges broadens its investor base and boosts liquidity.
6. Improving Financials: With revenue growth over the past few years and a history of profitability, Winking Studios has built a solid foundation for growth.

A Bright Future Ahead

Winking Studios’ journey from a small art outsourcing studio to a global leader is a testament to its commitment to quality and innovation. With plans to expand further, including potential acquisitions in Western markets, the company looks poised to capture a greater share of the global gaming services market.

For investors, Winking Studios offers a unique blend of stability and high-growth potential in a defensive industry, which deserves to be under our radar.

The info here is for reference only and please do your own due diligence.