Tag Archives: Circana report

US Physical Game Sales Halve Since 2021: A Sad Shift Towards Digital Dominance

In a significant shift within the gaming industry, US spending on physical video games has declined by more than half since 2021, according to recent data from market research firm Circana. This trend underscores the accelerating consumer preference for digital formats over traditional boxed copies. 

This echoes my experience with gaming, I am a die-hard physical media kind of person. I like to physically have my games, to collect and share (well, I am a collector). It has made me a little bit sad in recent times that my friends who I used to borrow and exchange games with, now – no longer have physical media to trade. I do understand the convenience, but rarely do I need a game there and then – and your purchase is lost forever once the servers shut down.

Several factors contribute to this decline. The widespread availability of high-speed internet has facilitated easier access to digital downloads, while online marketplaces on consoles have made purchasing games more convenient. Additionally, the rise of live service games, which often rely on microtransactions, has further propelled the digital shift.

Circana’s analysis indicates that the move towards digital consumption has gained momentum since the pandemic. Their data reveals that physical game spending is now over 85% below its 2008 peak. Despite this, overall content spending—including both physical and digital purchases, as well as subscriptions and microtransactions—has seen an uptick since 2019.

The rate of decline in US physical video game software spending accelerated in 2024. Spending on physical video game software in the US has been cut in more than half since 2021 and is now more than 85% below its 2008 peak. We'll see if Switch 2 can help slow/reverse this trend in 2025.

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— Mat Piscatella (@matpiscatella.bsky.social) 24 January 2025 at 20:24

It’s noteworthy that in 2024, a lighter release schedule for the Nintendo Switch, which traditionally bolsters a significant portion of physical game sales, may have contributed to the accelerated decline in physical purchases.

While the overarching trend leans towards digital, the rate of this transition varies across platforms and game series. For instance, in Europe last year, the overall digital share rose to 68% from 60%. Xbox’s digital share increased to 75% (up from 70%), PlayStation 5’s to 64% (up from 55%), while Nintendo’s remained steady at 22%.

As the industry continues to evolve, it remains to be seen how upcoming hardware releases, such as the anticipated Switch 2, will influence consumer purchasing habits in 2025.

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Source: VGC