Bad news. By the end of 2022, the global video game market will sink by 4.3%. This is reported by the analytical company Newzoo. She also notes that she is recording a reduction in the sector for the first time in the history of her monitoring.
For reference: Newzoo has been analyzing the gaming market since 2007. Which leads to the obvious conclusion: the drop in total annual revenue from video games is happening for the first time in at least fifteen years.
The analytical company came to such conclusions during the second revision of its own forecast in a year. In May, Newzoo reported that global revenue from video games will exceed the threshold of $200 billion. Then in July, she reported that revenue would only reach $196.8 billion.
However, even the last figure turned out to be too optimistic. Now the analytical company reports that annual sales of video games will amount to $184.4 billion (for comparison, in 2021 video games earned $192.7 billion).
Dynamics of global sales for 2020-2022
The most noticeable decline in sales is in mobile.
It will tentatively amount to 6.4% (up to $92.2 billion). Analysts do not talk about the reasons for the fall in the mobile market. But in general, they explain the whole situation with the correction of the market after two years of rapid growth.
The console market will also shrink significantly — by 4.2% (to $51.8 billion). Here the responsibility for the current situation is shifted to the pandemic. According to Newzoo, major studios are still only adapting to the processes in which they were forced to switch to a global lockdown (hence the numerous postponements of releases).
However, the analytical company also notes that inflation also contributed to the decline in global gaming revenue. Against the background of rising prices for basic necessities, people are forced to reduce their gaming spending.
At the same time, sales of PC games continue to grow. In 2022, their revenue will be $40.5 billion. This is 0.5% more than a year earlier. Moreover, in 2021, this segment was falling.
Distribution of gaming revenue by platform (2022)
When segmenting the market by geographical market, it is clear that the decline primarily affects the main gaming markets.
The Asia-Pacific video game market will fall the most by the end of the year. We are talking about a decrease in revenue by 5.6% to the level of $87.9 billion. Moreover, Newzoo analysts write that we are talking about a drop in indicators not only in China, but also in South Korea, and in Japan.
Also, a significant reduction in sales is demonstrated by the North American video game market — by 5.1% to $48.4 billion.
However, emerging markets continue to show growth: Gaming sales in the Middle East and Africa will grow by 6.6% to $6.8 billion, and gaming revenue in Latin America will grow by 3.4% to $8.4 billion
Distribution of gaming revenue by country (2022)
When it comes to all these forecasts, it is important to remember that we will learn the final figures for the market only from forecasts for 2023, which should not be expected before May.
And by this time, a lot can change, because the Christmas season is ahead, sales of which may be much higher than predicted.
For example, in December last year, Newzoo (which at that time did not have figures for the fourth quarter on hand) predicted that the revenue of the gaming market for 2021 would be $180.3 billion. However, as we can see now, in fact the market has earned much more ($192.7 billion). It is possible that history will repeat itself this time.
Interestingly, the report also mentions that:
- the number of gamers in 2022 will grow from 3.057 billion to 3.198 billion;
- 299 million console gamers and 458 million PC gamers do not spend money on games at all, even though they play.