Electronic Arts' (EA) planned $55 billion all-cash acquisition by an investor consortium led by Saudi Arabia's Public Investment Fund could unlock significant opportunities in the company's mobile and Ultimate Team businesses, Wedbush Securities said Tuesday.

The firm said PIF could leverage Scopely's expertise to revamp EA's mobile strategy, potentially generating about $1 billion in incremental annual free cash flow. Making Ultimate Team free-to-play could expand the user base to around 300 million from 25 million, adding another $1 billion in free cash flow.

Wedbush said that using Scopely to drive user acquisition through advertising could also result in more than $1 billion in additional annual ad spending, much of which would benefit Applovin (APP) and Unity (U).

The brokerage said it does not expect rival bidders to emerge, citing the lack of companies with the expertise and resources to compete with PIF. It also noted that intellectual property licensors could seek to renegotiate contracts, with higher minimum guarantees or modest take-rate increases likely.

Intellectual property licensors could capitalize on the opportunity to renegotiate contract terms. Wedbush said it expects minimum guarantees to increase or "modest take rate" increases.

The firm said the deal, expected to close in Q1 fiscal 2027, faces limited regulatory risk in the US, while European regulators may seek minor concessions. PIF's existing gaming assets account for only a small share of the global market, reducing concerns about competition.

Wedbush raised its price target on Electronic Arts to $210 per share from $200 and maintained a neutral rating.

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