There’s never a dull moment in gaming — and 2025 was no exception.
From AI to UGC and everywhere in between, the past year has been marked by significant change within the gaming industry — and not always for the better. Amid the rise of artificial intelligence throughout all stages of the development process, layoffs have continued across the industry over the past year, though at a slightly reduced pace from 2024. Yet gaming continues its ascension as a cultural force. On December 11, the Game Awards enjoyed its highest-ever viewership, bringing in 171 million global livestreams, an 11-percent increase from 2024.
Going into 2026, GamesBeat reached out to a range of industry leaders and observers representing all facets of the industry to get their thoughts on the narratives and trends that defined gaming in 2025. Here are some of the key takeaways.
Artificial intelligence is taking over gaming
In 2025, the trickle of game developers using AI turned into a raging river, with AI being leveraged for concept art, graphical optimization, quality assurance testing and a myriad of other use cases.
“I am excited for the enhancements that AI may bring around creative optimization, around potentially personalization in games,” said Zynga chief product officer Scott Koenigsberg.
The rise of AI in gaming hasn’t been without controversy — developers have spent months debating Steam’s AI use disclosure policies, and just this month, the Indie Game Awards stripped “Clair Obscur: Expedition 33” of its awards for using generative AI during the pre-production process. And as layoffs continue to rock the industry, some game developers are blaming AI for the cuts, for better or worse.
“I don’t think any of us really know how real that is. How much are these big studios using AI to do early asset development and content work, and how much is it actually making all the way to the end of the production pipeline?” said Brian Tanner, the co-founder and CEO of Artificial.Agency, which develops AI tools and integrations for gaming companies. “I think everybody’s very quiet about this, and it’s not at all obvious how much AI is actually having an impact, or if it’s more the boogeyman that people are blaming for other industry trends.”
In spite of its potential risks and challenges, industry observers believe AI could help address some of the gaming industry’s other pervasive issues, such as the mounting costs of development for triple-A titles.
“The cost of development has skyrocketed; it’s increased 90 percent over the last few years. It’s outpaced consumer spending by 1.6x — this is not a great business model for the games industry, and the industry knows that,” said Google Cloud global director for games Jack Buser. “We have to get development costs under control — a lot of that is iteration time, so the amount of time it takes you to get from an idea to something. In production, time equals money, so just getting that iteration time down is a huge push in the industry.”
The funding situation is getting trickier
After a gold rush in the years following the COVID-19 pandemic, funding for gaming companies has dried up considerably in 2025. In Q2 of the year, venture capital funding dropped by 47 percent, with funding flowing from the United States to other global markets.
One entity still spending significant amounts of money in gaming is Saudia Arabia’s Public Investment Fund. The PIF-led deal to acquire Electronic Arts for $55 billion was one of the biggest stories of the year.
Not all industry observers saw the slowdown in funding as a bad sign. After the head-over-heels growth of the last few years, 2025 arguably represented a return to normalcy, with companies able to focus on their core strengths rather than chasing endless growth.
“Looking back at 2025, the overarching narrative wasn’t about a sudden ‘boom,’ but rather a transition to a stronger, more sustainable era after the rapid growth of the past few years,” said Sebastian Weishaar, the chief product officer and general manager of the prominent esports company ESL/FACEIT Group. “Investment became much more focused, and the industry matured structurally.”
User-generated content is hotter than ever
From Roblox to Fortnite to the growing pool of smaller platforms available to players and creators, the power of user-generated content grew considerably in 2025, with stakeholders across the industry alike taking this format much more seriously over the past year.
Brands that have been trying to integrate themselves into popular triple-A games for years turned their budgets toward UGC in 2025. As advertisers like Unilever dedicate a significant chunk of their marketing and advertising budgets to creators, they are also realizing that user-generated content gaming platforms are creator marketing opportunities not unlike other creator media platforms such as YouTube and TikTok.
“The industry’s core audience has shifted away from traditional advertising toward an ecosystem dominated by user-generated content,” said Medal senior vice president of revenue Yuriy Yarovoy. “Gamers aren’t harder to reach; they simply trust their friends and family over brands. With 65% of players relying on their inner circles for information, the power dynamic has flipped: peer-to-peer sharing now holds the most influence.”
User acquisition is a growing challenge
Beyond AI and UGC, UA — that is, user acquisition — has also been a major source of discussion among gaming industry leaders and observers over the past year. In 2025, gaming companies have thrown out the traditional user acquisition playbook and are getting more creative to attract the eyeballs and fingers of prospective players.
As organic traffic from platforms peters out, gaming companies are looking to establish more direct relationships with consumers through features like web stores inside games and apps.
“2025 had a lot more game developers that looked and calculated incrementality of spends, and other activities outside of their hardcore UA activities,” said Matt Tubergen, the executive vice president of global partnerships and corporate development at Digital Turbine. “It was very binary — I spend $1, I get $1.50, based on my analytics tell me, and that’s typically a single-funnel management. Now, that’s starting to actually shift, where the gaming companies are starting to analyze some additional touchpoints to see what more of an omni-channel campaign would look like.”