Video Games sales in U.S. December 2012 and annual 2012

Analysis from NPD industry analyst, Liam Callahan

Overall

These sales figures represent new physical retail sales of hardware, software and accessories, which account for roughly 50 percent of the total consumer spend on games. When you consider our preliminary estimate for other physical format sales in December such as used and rentals at $217 million, and our estimate for digital format sales including full game and add-on content downloads including microtransactions, subscriptions, mobile apps and the consumer spend on social network games at $765 million, we would estimate the total consumer spend in December to be over $4.1 billion. Our final assessment of the consumer spend in these areas outside of new physical retail sales will be reported in February in our Q4 Games Market Dynamics: U.S. report.

An apt historical comparison for this this month is December 2005, which was the first December of the previous console generation. As a testament to how much the retail market has grown, overall physical dollar sales in December 2012 are up 10% when compared to December 2005.

NPD Group's U.S. Games Industry Sales (New Physical Sales Channel*) - December 2012 & Annual 2012

5-week month; Reporting Period 11/25/12 through 12/29/12

Dollar Sales	December '11	December '12	CHG	Annual 2011	Annual 2012	CHG
Total Video Game Sales (New Physical Channel)	$4.10B	$3.21B	-22%	$16.99B	$13.26B	-22%
Video Games Hardware	$1.33B	$1.07B	-20%	$5.57B	$4.04B	-27%
Video Games Software (Console+Portable - New Physical Sales only)	$2.07B	$1.54B	-26%	$8.69B	$6.71B	-23%
Video Games Accessories	$699.4MM	$603.0MM	-14%	$2.73B	$2.51B	-8%
Total Software Sales - (Console+Portable+PC - New Physical Sales Only)	$2.16B	$1.58B	-27%	$9.12B	$7.09B	-22%

December 2012 Top 10 Games (New Physical Retail only; across all platforms incl. PC)

1. Call of Duty: Black Ops II (360, PS3, Wii U, PC)** - Activision Blizzard
2. Just Dance 4 (Wii, 360, Wii U, PS3) - Ubisoft
3. Halo 4 (360)** - Microsoft
4. Assassin's Creed III (360, PS3, PC, Wii U)** - Ubisoft
5. Madden NFL 13 (360, PS3, Wii, PSV, Wii U) - Electronic Arts
6. Far Cry 3 (360, PS3, PC) - Ubisoft
7. NBA 2K13 (360, PS3, Wii, Wii U, PSP, PC)** - Take 2 Interactive
8. Skylander Giants (Wii, 360, PS3, 3DS, Wii U)** - Activision Blizzard
9. New Super Mario Bros. 2 (3DS) - Nintendo
10. FIFA Soccer 13 (360, PS3, Wii, PSV, Wii U, 3DS, PSP) - Electronic Arts

Annual 2012 Top 10 Games (New Physical Retail only; across all platforms incl. PC)

1. Call of Duty: Black Ops II (360, PS3, PC, Wii U)** - Activision Blizzard
2. Madden NFL 13 (360, PS3, Wii, PSV, Wii U)** - Electronic Arts
3. Halo 4 (360)** - Microsoft
4. Assassin's Creed III (360, PS3, PC, Wii U)** - Ubisoft
5. Just Dance 4 (Wii, 360, Wii U, PS3) - Ubisoft
6. NBA 2K13 (360, PS3, Wii, PSP, Wii U, PC)** - Take 2 Interactive
7. Borderlands 2 (360, PS3, PC)** - Take 2 Interactive
8. Call of Duty: Modern Warfare 3 (360, PS3, Wii, PC)** - Activision Blizzard
9. Lego Batman 2: DC Super Heroes (Wii, 360, NDS, PS3, 3DS, PSV, PC - Warner Bros. Interactive
10. FIFA Soccer 13 (360, PS3, Wii, PSV, 3DS, Wii U, PSP) - Electronic Arts

Software

In December 2012, positive trending for many annualized franchises like Call of Duty, Skylanders, Assassin's Creed, and FIFA, points to consumers' increased spending on hits, but that middle-tier games as well as catalog titles are suffering. This is evident in examining the share of December dollar sales that the top ten titles generated, which was 46% in December 2012, up 12 percentage points from last December.

A major culprit in the decline in retail sales in 2012 was the lack of new releases with 29% less SKUs across consoles, portables, and PCs. However, the SKUs that were released generated 8% more units per SKU and 11% more dollars per SKU.

The Xbox 360 version of Call of Duty was the top selling SKU this December, and has been the top selling SKU on an annual basis for the 4th year in a row.

Far Cry 3 generated positive critical reviews and ranked sixth overall based on December unit sales. This praise, along with stepping outside the hectic November launch period, led to this game being the second-most successful December launch since NPD began tracking retail sales in 1995.

Hardware

While overall hardware performance declined 21%, high-definition consoles fared better and experienced softer declines of 7%. Remaining platforms decreased much more sharply at around 30%, which represented over 80% of the overall unit decline in hardware.

As consumers look more and more for deals over the holidays while purchasing hardware, bundles which include software grew by 26%, while hardware selling alone with no games declined by 37%. Consumers are becoming more savvy and realizing they can get a lot more 'bang for their buck' with bundles typically offered for a limited time over the holidays.

2012 culminates a year where Xbox 360 dominated hardware sales. Despite year-over-year declines versus last December, this was the 17th month where the Xbox 360 held the top hardware position.

Sales of the Wii U were lower on a unit basis when compared to the original Wii in December 2006. However, due to its higher price, the Wii U has generated 3% more dollar sales than the Wii when looking at Dec vs Dec, but it is 11% for YTD.

While this is the first December for the PS Vita, when comparing combined sales of the PS Vita and PSP, there was a 94% rise in dollar sales compared to December 2011.

Accessories

Skylanders Giants continued to impress with its accessory sales, with character and battle packs generating more than double the unit sales compared the original Skylanders when looking at this December versus last.

This marked the best December ever for point and subscription card sales on a unit and dollar basis. 2012 was also the best year for point card and subscription card sales as gamers sought digital content on Xbox Live, PlayStation Network, and Nintendo's eShop. Games like Journey and Minecraft broke records for number of games downloaded.

Outside of point cards and Skylanders, Headset and Headphones within the video game accessory category grew compared to 2011, led by Turtle Beach.