Video game sales pause as people go outside again
The Future. After years of growth, the video game industry is facing declining sales as it now competes with live events, traveling, and all the other hallmarks of a life spent indoors. That’s not to say that the industry has anything to worry about, but communicating to Wall Street that the unprecedented good times of COVID (an irony, we know) were bound to end may be its new challenge.
The video game industry is facing a new hard-to-beat foe: renewed interest in going outside.
- Per WSJ, overall sales are down 13% in Q2 after dropping 8% in Q1.
- Sensor Tower and NPD Group report that overall sales for the year will likely be down almost 9%, marketing the first full year of declining sales since 2016.
- It’s no surprise considering top companies like Activision Blizzard, Electronic Arts, and Take-Two Interactive are all reporting slow revenue growth… and few have any big titles coming out this year that could rebound sales.
- Even Roblox, an absolute growth machine during the pandemic, fell between 30% and 40% over the last two quarters. That sent its stock down 10%.
- And Netflix, which is actively pushing to get into gaming, has only converted less than 1% of its subscribers to give its titles a try.
Like streaming, the slowdown in gaming was inevitable as people emerged from the shadow of the pandemic and wanted to explore the world again. KeyBanc analyst Tyler Parker said that there’s clearly “been a big shift toward more experiential spending.”
It may be time to let live events have their day in the sun.