Video Game Sales Down 28 Percent in May

Sales for the video game industry in May were down dramatically, according to the latest sales figures from NPD Group. Total sales were $516.5 million, down 28 percent compared to a year ago. Hardware sales were down 39 percent to $138.9 million, while software sales on consoles and portables dropped 32 percent to $255.4 million. When PC video game sales are added into the mix, the total comes to $335.2 million, down 16 percent.

Diablo III was the top selling PC game for the month, bringing PC video game sales up year-over-year to 230 percent, or $80 million.

"These sales figures represent new physical retail sales of hardware, software and accessories which account for roughly 50-60 percent of the total consumer spend on games," Frazier said. "When you consider our preliminary estimate for other physical format sales such as used and rentals at $155 million, and our estimate for digital format sales including full game and add-on content downloads including micro-transactions, subscriptions, mobile apps and the consumer spend on social network games at $420 million, we would estimate the total consumer spend in May to be $1.17B. Our final assessment of the consumer spend on these areas outside of new physical retail sales will be reported in September in our Q2 Games Market Dynamics: U.S. report."

BMO Capital Markets US Research analyst Edward S. Williams says that the decline in retail boxed goods and the strength of digital goods are strong indicators that "packaged goods sales are becoming less significant relative to overall sales and reported NPD figures are becoming less indicative of total company revenues."

He added that his firm predicts that retail software sales trends will improve "in the back half of the year with the arrival of a stronger release schedule."

The top selling games for May were Diablo III, Max Payne 3, Tom Clancy's Ghost Recon: Future Soldier, Prototype 2, NBA 2K12, Call of Duty Modern Warfare 3, Sniper Elite V2, Battlefield 3, Dragon's Dogma, and Just Dance 3.

Image provided by Shutterstock.

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