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Analyst increases software growth estimates

Michael Pachter bumps up 2008 predictions significantly for US and Europe

Wedbush Morgan's Michael Pachter has increased his software sales growth estimates for 2008 in both the US and Europe - almost doubling the amount previously estimated.

His prediction for the US is now for software sales to grow by 32 per cent, up from his previous estimate of 19 per cent, and for Europe to see a 40 per cent rise, up from a previously expected 20 per cent.

Additionally he's expecting a 36 per cent dollar increase for the combined markets following strong sales so far this year - although he expects predictions for the rest of the year to be more difficult.

"Beginning in September, comparisons become far more difficult, and remain so over the balance of the year," he said in a note to investors. "Further, July saw a slight slowing of hardware demand [in the US] (up only 17 per cent, following May and June gains of 34 per cent and 54 per cent respectively), implying that software sales in future months could begin to slow.

"However, Wii hardware supply has been tight, and we expect an increase in supply some time in the next several months. We expect year-over-year sales growth to temper in September to somewhere closer to the teens, and expect sales growth to range between mid-teens and mid-twenties for the balance of the year."

Regarding the month just gone, he's expecting the biggest sellers in the official NPD statistics to include:

  • Madden NFL 09 (PS3, 360, Wii, PSP, PS2, DS)
  • Mercenaries 2: World in Flames (PS3, PS2, PC, 360)
  • Too Human (360)
  • Mario Super Sluggers (Wii)

Meanwhile top sellers this month should be led by Electronic Arts' Spore and LucasArts' Star Wars: The Force Unleashed.

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