According to market research firm Circana, US consumer spending on games might experience a significant decline of up to 10% this year. Analyst Mat Piscatella, speaking to GamesIndustry.biz, stated that this figure lands in the "pessimistic" range for the potential outcome in the US market for 2024.
Piscatella expressed his concern about the upcoming months, even if the spending stays on the more positive end of the spectrum. He mentioned, "Right now my most optimistic outlook is down about 2%. If you start looking a little bit on the more pessimistic side, you're looking at down about 10%. If things really go sideways, you're looking at a little bit more."
With anticipated releases like Grand Theft Auto 6, Switch 2, and Sony's upcoming games facing delays and uncertainties, the game market is indeed heading into challenging times.
Piscatella highlighted the unexpected success of games like Helldivers 2 and Palworld, which emerged as top contenders this year. However, he emphasized the need for another standout title to match the impact of previous hits like Hogwarts Legacy.
He emphasized, "The uncertainty level this year is probably the highest I can recall, with the uncertainty of what's going to get us to the finish line because we don't have those big games announced that we know."
Circana also forecasted challenges for games retailers, especially with the absence of new hardware from Nintendo and the growing preference for digital purchases. Piscatella noted, "Retail has had to get really clever, and on the physical side of the business it continues to decline. With no new Nintendo hardware this year, it's going to accelerate because retail still relies on Nintendo much more than they do other platforms."
In conclusion, the gaming industry is facing a tumultuous period in 2024 with uncertain consumer spending, delayed game releases, and shifting market dynamics. It remains to be seen how the industry will adapt and overcome these challenges in the months ahead.
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