NACON's Rally Back: How the WRC Licensing Deal Could Ignite a Gaming Stock Surge

The gaming industry is all about control of the license—and NACON ($NACO) has just seized the wheel. After losing the World Rally Championship (WRC) license to EA/Codemasters in 2022, NACON has now reacquired it in partnership with studio Kylotonn, positioning itself to capitalize on a $2.3B motorsport gaming market primed for growth. This deal isn't just about revving engines; it's about reigniting a high-margin content pipeline that could propel NACON's stock into the fast lane.

Why the WRC License is a Game-Changer for NACON

1. Recapturing a Proven Franchise:
   NACON's previous WRC games (e.g., WRC Generations) were commercial hits, but losing the license in 2022 forced it to pivot to riskier projects like the underwhelming Solar Crown. Now, with the WRC rights secured again, NACON can leverage its 16 internal studios—including Kylotonn, which developed WRC 9 and WRC 10—to create a modern, immersive rally experience. This isn't just nostalgia; it's a strategic return to a proven revenue driver.

2. Esports Goldmine:
   Rally esports is exploding. The FIA's WRC esports series has over 1.5M monthly viewers, and NACON's expertise in peripherals (think rally-specific steering wheels) could monetize this audience directly. Pairing the WRC license with its hardware division creates a dual revenue stream: sell the game, then sell the gear to play it.

3. High Margins, Low Risk:
   Licensing deals like this are cash cows. NACON avoids the costly gamble of original IP creation while benefiting from the WRC's global brand recognition. Unlike EA, which hemorrhaged cash on WRC after its 2021 Codemasters acquisition, NACON's leaner structure can deliver profitable games without overextending.

Note: NACON's rebound post-2025 reacquisition could mirror EA's 2023 spike after announcing WRC—but without the costly missteps.

Synergies That Make This Deal Unmissable

• Studio Synergy: Kylotonn's rally expertise and NACON's 15 other studios (e.g., Cyanide for strategy games, Milestone for motorsports) can cross-pollinate talent. Imagine rally-themed DLC for WRC fans or shared tech between racing and simulation games.
• Hardware Boost: NACON's steering wheel sales (already 30% of revenue) could skyrocket if tied to a new WRC game. Rally enthusiasts will pay a premium for authentic controls.
• Esports Infrastructure: NACON can host WRC-sanctioned tournaments, streaming deals, and in-game microtransactions—all scalable with minimal incremental costs.

Risks? Sure, but They're Speed Bumps, Not Crashes

• Competitive Threats: EA's exit reduces direct competition, but smaller rivals like Polyphony (Gran Turismo) loom. However, WRC's niche focus and NACON's rally-specific hardware give it an edge.
• Development Delays: NACON's past missteps (e.g., Solar Crown) raise concerns. But with Kylotonn's proven track record and a shorter pipeline (no more $30M flops?), this risk is manageable.
• WRC's Popularity: Rally racing's declining TV viewership could hurt. But esports and sim racing are growing faster than traditional broadcasts—NACON's focus on digital engagement mitigates this.

The Bottom Line: Buy NACON Now—Before the Rally Starts

This deal isn't just about a game; it's about owning a slice of a high-growth, low-innovation-risk market. With WRC's esports boom, synergies across studios and hardware, and a lighter balance sheet post-Solar Crown, NACON is primed to convert this license into recurring revenue for years.

Watch for gaming revenue to surge past peripherals in 2026–2027 as WRC titles launch.

Action Items:
1. Buy NACON stock immediately—its P/E of 15 is a steal compared to EA's 22.
2. Set a price target: $18–$22 by 2026 (up from $12 today), assuming two WRC titles and esports deals.
3. Watch for:
- Q3 2025 earnings for WRC-related pipeline updates.
- Partnership announcements with rally teams or streaming platforms by early 2026.

This isn't a bet on a single game—it's a bet on NACON's ability to turn licensing power into profit. The rally is on—don't miss the start.