The US video game industry is expected to experience revenue declines in 2024, but a new report predicts 2025 will see the business bounce back due in part to Grand Theft Auto VI and Switch 2.
Circana’s Future of Games report, released today, said the video game industry “matured” in 2020 and 2021 as people turned to games to have fun and stay connected with friends and family during the pandemic.
The number of people playing video games and the time spent playing continues to fall behind the all-time highs achieved in 2021, Circana said. The downturn is attributable in part to inflation on everyday items people need to live like groceries, which in turn has left less money available to the average person to spend on gaming, Circana said.
For 2024, video game hardware revenue is expected to continue to decline due in part to the total number of units sold and their average prices declining. People have shifted some of their play time to more accessible platforms like PC and mobile, and this has helped offset some of the declines in the console market, Circana said.
“This will continue to be a difficult year for video game manufacturers and publishers, as an overall spending decline, albeit in the low single-digits, is expected,” Piscatella said.
Looking ahead to 2025, though, Piscatella said the US video game industry is poised for a rebound. GTA VI, which is among the most-anticipated games of all time, along with the massively hyped Switch 2, should help the video game industry’s fortunes in 2025, Piscatella said.
“The anticipated first-half debut of Nintendo’s next generation hardware platform should provide a significant boost, as should the launch of Grand Theft Auto VI, which may just become the biggest entertainment launch in US history,” Piscatella said.
Not only are video game industry revenues falling this year in the US, but a number of major developers are cutting jobs. More than 10,000 video game jobs have been lost so far in 2024 worldwide.
