The Gaming Industry Will ‘Shrink’ for the First Time in 10 Years

Sony, Microsoft, and Nintendo have released financial reports for the quarter ended June 2022. Published reports showed that the video game world is shaking. Why?

Microsoft, Sony, and Nintendo, the leading names in the video game world, have published their reports about the quarter ending in June 2022. Published reports have revealed that there is a shrinkage in the video game world. While sales of all companies declined, this was due to the COVID-19 pandemic, which was left behind, at least in terms of restrictions. According to industry sources, people who are tired of staying at home are now going out and don’t care about video games as much as they used to.

According to research conducted by the market research company NPD, gamers in the US alone spent $ 12.4 billion on games in the second quarter of the year. Although this figure seems astonishing, it is thought-provoking for the sector. Because compared to last year, we see a contraction of 13 percent. This is reflected in the sales of Microsoft, Sony, and Nintendo.

Sony’s profitability has decreased by 37 percent!


In the statements made by Sony, it was stated that the revenues from the game decreased by 2 percent. The company’s profitability also declined by 37 percent. Sony, which has also lowered its profit forecast for the end of the year, thinks that it will close 2022 with a profit of 16 percent. In addition to all this, Sony announced that the average playing time of Playstation players has decreased by 15 percent. Hiroki Totoki, Sony’s chief financial officer, said interest in video games is waning as opportunities for people to leave home have increased. On top of all that, let’s just say that Sony sold 2.4 million PlayStations last quarter. This figure is almost the same as last year.

Microsoft’s Xbox sales fell 11 percent


The statements made by Microsoft were also not encouraging. The company announced that gaming revenues were 7 percent lower than the same period last year. Microsoft said that Xbox sales fell by 11 percent, while earnings from game content fell by 6 percent. However; Activision, one of Microsoft’s gaming companies, announced that its net profit fell by 70 percent and its revenue by 29 percent. But this decline isn’t exclusive to Activision. Ubisoft also announced a 10 percent drop in revenue. EA, on the other hand, increased its revenue and profitability in contrast to the sector. The company’s profit increased by 50 percent and revenue by 14 percent.

Nintendo says they fell victim to the chip crisis!


Nintendo, in its statements for the April-June 2022 period, announced that its operating profit decreased by 15 percent. 3.43 million units The company, which sells Switch consoles, has sold 41.4 million units of the game software. In the statements made by the company, it was stated that the reason for the decline was the chip crisis. According to the company, Switch production was disrupted due to the chip crisis and sales fell as a natural consequence.

According to analysts, 2022 will be the worst period in the last 10 years.

According to research firm Ampere Analysis, 2022 will be a challenging year for the video game world. In this context; According to experts, who estimate that the market size will be $ 188 billion, this figure will be recorded as the first contraction in the last 10 years. The global economic crisis and inflationary pressures are thought to drive people further away from video games.

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