Video game business slammed in April

Overall revenues were down 26 percent year-over-year in April, while hardware was down 37 percent, according to The NPD Group.

The video games industry in April suffered its worst monthly year-over-over sales decline since July 2009, with overall revenues down 26 percent and hardware down 37 percent, according to a report Thursday from industry analyst The NPD Group.

In April, total revenues came in at $766.2 million. A year earlier , in the second month of steady declines after appearing like an industry that was resistant to the full impact of the recession, it had posted sales of $1.03 billion. For the year, sales came in at $4.73 billion, down 11 percent from the $5.29 billion recorded through the end of April 2009.

Though it had its usual first-place finish among consoles, Nintendo's Wii saw sales drop precipitously from a month earlier. In March, the Wii moved 557,500 units, but just 277,200 in April. Microsoft's Xbox 360 was second with 185,400 sold, while Sony's PlayStation 3 finished just behind at 180,800 sold.

The bleak picture for April may not be quite as bad as it looks, though. According to NPD analyst Anita Frazier, some of the industry's overall decline may be attributable to Easter falling in March this year. "In April 2009, consumers attributed $55 million of industry sales to Easter as a purchase occasion," Frazier said, "which would account for about 21 percent of the decline from last year."

Still, even that charitable allowance doesn't cover most of the revenue shortfall the industry turned in last month. On the software side, where sales slid 22 percent from a year ago, Frazier said that a big culprit was the industry's bigger than usual drop in sales for March's new releases. Frazier explained that games released in March 2009 saw sales drops of 54 percent in April 2009, while those released in March 2010 fell 75 percent last month.

The only good news NPD highlighted Thursday was that both the Xbox and the PS3 saw sales increases over a year ago and that the Nintendo DS handheld gaming machine sold 440,800 units and is approaching the lifetime sales numbers of Sony's PlayStation 2. By October or November of this year, Frazier predicted, the DS may well surpass the PS2 in lifetime sales.

About the author

Daniel Terdiman is a senior writer at CNET News covering Twitter, Net culture, and everything in between.

 

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