Revenue from U.S. video game sales dropped 31 percent to $1.17 billion in June, compared with $1.7 billion a year earlier, according to data released Thursday by market research firm NPD Group.
The ongoing economic recession and a lack of blockbuster game title releases were blamed for the drop, the fourth decline in video game sales in as many months.
"This is one of the first months where I think the impact of the economy is clearly reflected in the sales numbers," NPD's Anita Frazier said in a statement. "This level of decline is certainly going to cause some pain and reflection in the industry."
Hardware sales suffered the greatest hit, falling 38 percent to $382.6 million from $617.3 million in the year-ago month. Only the Microsoft's Xbox 360 game console managed to record a slight sales increase, while Nintendo Wii sales dropped 45 percent, and the Sony PlayStation 3 dropped 59 percent.
Game sales revenue suffered the second largest hit, falling 29 percent to $625.7 million from $875.8 million a year ago. Sales of video game accessories also declined, falling 22 percent $158.2 million from $202.8 million a year ago.
Once seemingly recession-proof, the game industry has fallen on hard times. Video game sales dipped below $1 billion last month for the first time since 2007.
NPD also suggested that part of the decline may be due to gamers moving to online gaming, but said that trend did not represent a significant threat to console makers.
"While some of the decline in retail sales could be a migration on the part of consumers to acquiring content via digital distribution, our reports on downloads and subscriptions reveal that it's not yet having enough impact on the console market to be an overly meaningful factor in the retail down-turn," Frazier said. "That said, there are increasing avenues for consumers to game, including via mobile devices, and it's clear the industry is sorting through how to manage all these opportunities while deploying resources appropriately."
Video game industry sales in the U.S. dropped 23 percent to $863 million in May compared with $1.12 billion a year ago, according to a new report.
This marked the first time since August 2007 that monthly sales dipped below $1 billion, NPD Group said Thursday in its report.
The drop was felt across the board as gamers coughed up less cash for hardware, software, and accessories. Sales for hardware fell 30 percent year over year to $302.5 million. Software revenue was down 17 percent to $449 million, while sales of gaming accessories tumbled 25 percent to $112 million.
"The video games industry continues to struggle with difficult comparisons to last year," NPD analyst Anita Frazier said in a statement.
NPD blamed most of the decline on the lack of blockbuster games rather than the weak economy. The report noted that last year's sales were boosted by the launch of popular software titles such as Grand Theft Auto IV. Nintendo's Wii Fit also was a hot commodity in 2008.
"While there were some very strong new releases this month," Frazier said, "this month's top 10 games sold 2.6 million units combined, whereas last year the top 10 sold 3.7 million units. Again this illustrates how tough the comparisons are to last year."
Nintendo's Wii was the best-selling system in May at 289,500 units, though sales plummeted from last year. Microsoft's Xbox 360 found 175,000 new customers, a gain of 22 percent from a year ago. Sony brought up the rear, selling only 131,000 PlayStation 3 and 117,000 PlayStation 2 consoles.
Despite the sluggish sales, NPD has a positive outlook for the rest of the summer.
"Looking ahead to June, there are some promising games coming out this month between Sims 3 (PC), Prototype, Red Faction, Virtual Tennis, Ghostbusters, Transformers and Tiger Woods just to name a few," noted Frazier. "June comparisons are still likely to be tough, but the wide variety of new content could help reinvigorate things somewhat."
The May report followed NPD's analysis for April, which showed that video game sales had dipped 17 percent year over year.
Despite a slowing economy, sales of U.S. video games and hardware soared 18 percent from the same month a year ago, according to data released Thursday by market researcher NPD Group.
Hardware sales were up 5 percent to $494.7 million, led by Nintendo's Wii game console. Wii held onto the top spot by selling 803,000 units in October, up from 687,000 in September. The Wii, which has been plagued by shortages, has sold more than 13 million units since its release in November 2006.
Microsoft's Xbox 360 held onto the No. 2 spot by selling 371,000 units, a 7 percent increase over September following a price cut that month. Sony's PlayStation 3 came in third with 190,000 units sold, an 18.2 percent increase over the prior month.
Software sales were up 35 percent to $696.8 million, led by Microsoft's Fable II, which sold 790,000 units. Second place went to Nintendo's exercise game Wii Fit, which sold 487,000 copies.
Meanwhile, sales of portable video games were down 14 percent.
The video game industry faces a tough holiday shopping season, following a bankruptcy filing by retailer Circuit City and a revenue warning from rival Best Buy.
Sales of video game software and hardware in the U.S. rose 9 percent in August to $1.08 billion, the smallest monthly increase in more than two years, according to data released Thursday by market researcher NPD Group.
Hardware sales were up 3 percent to $395 million, led by handheld Nintendo DS, which sold 518,300 units. Nintendo's Wii came in second with 453,000 unit sales, and Microsoft's Xbox 360 claimed the third spot with 195,200 unit sales.
Software sales were up 13 percent to nearly $551 million, led by Electronic Arts' Madden NFL 09 and Nintendo's Wii Fit and Mario Kart. Sales of accessories rose 13 percent to $137 million.
The video game industry has weathered the economic downturn better than most industries, but August's sales increase is the first rise below 10 percent in 27 months, NPD analyst Anita Frazier said. However, she said projections for 2008 are still looking strong overall.
"Despite smaller growth this month, the industry is up 32 percent year-to-date and remains on target to achieve annual revenues in the range of $22 billion to $24 billion," Frazier said in a statement.
- prev
- 1
- next
