According to market research firm NPD, US consumer spending on video game products fell by $ 1.78 billion in the second quarter. Overall, video game spending in the United States was $ 12.35 billion last quarter, down 13% year-over-year. The results follow both Microsoft and Sony who reported a decline in gaming revenue due to the slowdown in the growth of the pandemic.
Sony warned of weaker PlayStation activity earlier this week as it saw gaming software sales plummet 26% year-over-year. Sony attributed the slump to a lack of great PlayStation titles this year compared to 2021 and shorter time spent playing overall. Microsoft’s Xbox hardware revenue fell 11% year-over-year in the last quarter, along with a 6% decline in Xbox content and services revenue and a 7% decline in overall gaming revenue.
Nintendo will report its first-quarter tax earnings on Wednesday, but the company plans to sell 21 million Switch consoles earlier this year for its fiscal year ending March, down from 23.1 million a year earlier. .
While overall gaming spend clearly declined across the industry in the second quarter, subscription content “was the only segment that posted positive gains,” according to NPD. That growth is despite Sony launching its renewed PlayStation Plus subscriptions at the end of the quarter.
Hardware unit sales were led by Nintendo Switch in the second quarter, according to NPD, with the PS5 generating the highest dollar sales. Despite falling spending due to high inflation rates and after a great period of growth, “consumer spending continues to trend above pre-pandemic levels,” says Mat Piscatella, a gaming industry analyst at NPD. “However, unpredictable and rapidly changing conditions may continue to impact the market in unexpected ways in the coming quarters.”
