Full-year US sales fall 8% following weak December

Xbox 360 still ahead in the console war, even as hardware and software sales fall

News by Rachel Weber Senior Editor

Published on Jan. 13, 2012

The latest figures from NPD group show total US video games sales for 2011 stood at $17.02 billion, a fall of 8 per cent on 2010's $18.59 billion.

"December was very rough for new physical sales of video games hardware, software and accessories," said analyst Anita Frazier.

"Because of the great slate of content that came to market during the fourth quarter, I had expected December sales to represent a larger portion of total year sales than what occurred. This year, December accounted for just 23 per cent of annual sales, while the average for the past ten years has been 28."

Total video game sales including hardware, software and accessories were $3.99 billion for December, a drop of 21 per cent from the $5.07 billion of 2010. The biggest fall came from hardware, which fell by 28 per cent from $1.84 billion in 2010 to $1.32 billion in 2012.

"Wii sales down 55% year-over-year; combination of losing its luster and the Wii U coming out next year. 3DS sales solid, though," tweeted Wedbush Securities analyst Michael Pachter on the NPD results.

PlayStation and Xbox 360 sales saw a rise of 5 per cent for December 2011, with the Xbox 360 responsible for almost 40 per cent of physical retail sales across all categories for the year. Wii and PlayStation 3 were tied in second place for hardware unit sales.

"Normally, we see sales increase from November to December on an average sales per week basis," said Farzier. "The 3DS and the DS were the only platforms to realise a unit sales increase versus November, which is highly unusual since typically all platforms enjoy a lift in the biggest month at retail."

"The Xbox 360 was the best-selling platform for the year, and the two HD platforms were the two platforms to realise a unit sales increase over last year. All other platforms declined in unit sales versus 2010 (save the 3DS which wasn't in market last year)."

Software sales were at $2.14 billion for the month, a fall of 15 per cent on last year. Call Of Duty: Modern Warfare 3 topped the software sales charts for both 2011 as a whole and December alone.

"In a bright spot for content sales, sales of games for HD platforms were up 8 per cent in dollars in December, and 9 per cent for the total year," added Frazier.

Aaron Greenberg, chief of staff for interactive entertainment business at Microsoft took to Twitter to comment on the figures.

"NPD data for Dec US retail sales shows Xbox 360 had 46% share & 1.7M units sold, best selling console & 7 of top 10 game sales."

The Official Microsoft Blog added to the figures, revealing that Xbox 360 captured 49 per cent of consumer retail dollars, with $6.7 billion in sales for 2011. The 360 sold 1.7 million units in December.

"This marks the tenth consecutive month Xbox 360 has held more than 40 percent of the current-generation console market share, and twelfth straight month Xbox 360 was the top-selling console in the U.S." reported the blog.

It also showed that retail spend on the Xbox 360 alone, across all categories, was $1.5 billion.

"While unit sales are down less than dollar sales in the software category, the average retail price of software was down over 10 per cent in December versus last year," continued Frazier.

"This could indicate that aggressive promotions which lowered the average retail price did not spur an increase of unit sales the way they were intended to do."

Frazier also explained that both editions of Star Wars: The Old Republic, the standard and the special collector's version, generated the same dollar sales despite shifting different unit numbers, thanks to the high price point for the special edition. According to NPD data the game sold just over 600,000 physical copies in December.

"The top 20 titles in December generated nearly half total software revenue for the month, which is very high."

December 2011 Top 10 Games (New Physical Retail only; across all platforms incl. PC)