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NPD October: Gaming Sales Hold Up

THQ is trimming staff and focusing on a smaller slate of titlesEA announced layoffs too and forecast caution.   Activision showed results that were stellar.  Sony got crushed with currency issues.  Nintendo raised sales expectations for the Wii.   Depending on where you looked, this earnings season was filled with mixed messages from gaming companies. These, stacked on top of stalling retail foot traffic and surprisingly weak retail sales data in August and September, have made it very difficult to gauge the health of the gaming industry heading into the pivotal holiday shopping season. 

Is the industry recession resistant?  Are negative results merely the result of delayed purchases, or single company management choices?  Or is the industry feeling the weight of the greater economy?  It’s been so tough to tell.

Today, NPD Group released their U.S. sales data for October.  The new information adds some much needed additional perspective.

While not conclusive, the information suggests the industry is holding up reasonably well.  The data suggests hit titles and top selling consoles are still well in demand even with consumer spending otherwise receding.

Overall, October gross sales were $1.31b, equivalent to an 18% year over year improvement.  Software sales were up 35% to $697m. Hardware sales were relatively flat at about 5% growth, that largely due to weakness with portable players which were down about 14%.

 “The console portion of the market made significant gains at 26% across hardware, software and accessories, while the portable side of the market stalled, declining 14%,” said NPD’s Anita Frazier.

Surprising no one, Nintendo’s moves to assure sufficient inventory for holiday demand appear to be paying off.  Both the Wii and the DS finished at the top of the respective categories with 803,210 Wiis and 491,176 Nintendo DS portables sold.  “These figures bring the lifetime U.S. sales for Wii to more than 13.35 million and Nintendo DS to more than 23.02 million, extending their leads as the best-selling hardware of this generation.” Nintendo said.  Wii sales were Nintendo’s best month since December 2007.

Microsoft, still riding the benefits of price cuts on the Xbox 360, finished third overall (2nd in consoles) with sales of 371k units, good enough for a 7% increase in unit sales over the September result, as well as a year over year gain.  Sony PS3 sales were down sequentially but still up 57% year over year in unit sales.

In software, as with hardware, consoles dominated the top ten list but the month’s bigger story may be variety.  There was a near equal mix of titles for mature audiences and games rated “E for everyone” in the distribution.   There was also a reasonably wide distribution among platforms.  Nintendo took three slots with their recurring hits, Wii Fit (#2 overall), Mario Kart and Wii Play.   Microsoft took five total slots, with Fable II the month’s best seller.  Sony took two slots with their exclusives: SOCOM: US Navy Seals and Little Big Planet titles. "Little Big Planet’” performance was particularly good. Despite only five days of sales before the close of the month, it sold enough units to finish eighth.   

The one thing that was missing from the software top ten was a rhythm game.  Surprisingly, neither a Rock Band nor Guitar Hero title made the list.

Here are the rest of the October results, by the numbers:

October Hardware Sales (in units sold) (September Result)
• Wii: 803,000 (687,000)
• Nintendo DS: 491,000 (536,800)
• Xbox 360: 371,000 (347,200)
• PlayStation Portable: 193,000 (238,000)
• PlayStation 3: 190,000 (232,400)

October Software (Title (Platform) –Publisher -Units
1. Fable II (Xbox 360) – Microsoft – 790,000
2. Wii Fit w/ Balance Board (WII) – Nintendo – 487,000
3. Fallout 3 (Xbox 360) – Bethesda Softworks – 375,000
4. Mario Kart Wii w/ Wheel (WII) – Nintendo – 290,000
5. Wii Play w/ Remote (WII) – Nintendo – 282,000
6. Saints Row 2 (Xbox 360) – THQ – 270,000
7. SOCOM: US Navy SEALs Confrontation (PS3) – Sony – 231,000
8. Little Big Planet (PS3) – Sony – 215,000
9. NBA 2K9 (Xbox 360) – Take-Two Interactive – 202,000
10. Dead Space (Xbox 360) – Electronic Arts – 193,000

Overall Industry Totals (Total ( % Change Y/Y)(Last month’s total))
Video Games: $ 1.31B(18%)  ($1.27B)
Video Games Hardware: $495M (5%) $498.0M)
Video Games Software: $ $697M (35%) ($550.7M)
Video Game Accessories: $120M (-8%) ($137.3M)

For comparative data, NPD’s data from each month for the past year can be found by clicking the names of the month as follows:
2008: •January  •FebruaryMarchAprilMayJuneJulyAugustSeptember
•February•March•April•May•June•July•August •September•OctoberNovember December

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