The video game hardware market records its worst November in nearly 20 years
The latest data from the analyst firm Circana paints a complex picture for the hardware sector. During last November, U.S. consumer spending in this category totaled 695 million dollars, a figure that represents a 27% decline compared to the same period last year. This result positions the month as the November with the lowest spending since the company began tracking in 2005. 📉
A historic decline in units sold
The outlook worsens when analyzing the number of devices sold. In November, 1.6 million units of hardware were shipped, the lowest quantity for a November since 1995, when 1.4 million were sold. What's striking is that this setback occurs at a symbolic moment: both PlayStation 5 and Xbox Series X/S reached five years on the market. This suggests that the current console lifecycle may be reaching a maturity phase, where sales stabilize rather than grow.
Key factors explaining the decline:- High prices: Reports indicate that the cost of consoles, especially premium models or those with more storage, has not helped boost sales.
- Economic context: Consumers prioritize other expenses in a generally tighter financial environment, discouraging impulse purchases.
- Cycle phase: The initial spending peak that typically accompanies the launch of a new console generation is fading.
This is the lowest total hardware spending for a November since the 455 million dollars in November 2005.
The weight of price and historical comparison
Circana's report highlights that the rising costs of consoles likely did not stimulate buyers. Although it does not detail exact figures, it is understood that maintaining high price points, even with hardware revisions, can deter casual gamers or those waiting for aggressive discounts. This November data contrasts sharply with previous periods in the same cycle, where novelty and availability generated much more significant spending.
Long-term market outlook:- References to 2005 and 1995 provide a nearly two-decade perspective, indicating this is not a one-month issue.
- Structural factors, such as the longevity of current hardware and the rise of digital services, are redefining buying habits.
- The industry is undergoing a transition where content and digital access may delay the decision to invest in a new physical console.
Where is the market heading?
Analysts will closely watch December figures, a traditionally strong month due to holidays, to determine if this downturn is a consolidated trend or a seasonal anomaly. The current performance of video game hardware raises questions about how demand will evolve in the final phase of the current console cycle and how the industry will adapt to a consumer who may prefer to wait before upgrading their equipment. 🎮