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Wedbush Calls April Video Game Growth A 'One-Hit Wonder'

Wedbush Calls April Video Game Growth A 'One-Hit Wonder'
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In a report published Friday, Wedbush analyst Michael Pachter commented on NPD data (released Thursday) that showed gaming console and hardware software sales rose 13 percent year-over-year to $257 million, exceeding the analyst's estimates of $248 million.

"Sales were up for the third time in four months and by a double-digit percentage for the first time since last May (when Ubisoft released Watch Dogs), driven by new release Warner Bros.' Mortal Kombat X> which sold 1.28 million units, roughly double our estimate of 650,000 units," Pachter wrote. "The game had the strongest launch month of any new release in 2015 so far, a reflection of solid reviews and the franchise's pedigree."

Xbox One Outsells PS4

Pachter said overall sales were higher despite a continued decline in current-gen sales and an early Easter falling on April 5, just one day after the end of the March retail month. The analyst noted that during the month, 187,000 Microsoft Corporation (NASDAQ: MSFT) Xbox One units were sold, falling short of his 175,000 estimate. In addition, 175,000 Sony Corp (ADR) (NYSE: SNE) PS4 units sold in the month were also short of his 250,000 estimate.

Interestingly enough, sales of Xbox consoles exceeded those of PS4 for the first time since December of last year, reflecting a $50 price cut and bundles. Moreover, sales of Xbox One consoles were above those of Nintendo 3DS for the first time in three month, likely a result of declining popularity in the Nintendo console as a "solid" game slate finally waned.

Latest Ratings for MSFT

Oct 2016NomuraMaintainsBuy
Oct 2016William BlairUpgradesMarket PerformOutperform
Oct 2016WunderlichUpgradesHoldBuy

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Posted-In: Michael Pachter Mortal Kombat X NPD PS4 UbisoftAnalyst Color Analyst Ratings Tech Best of Benzinga


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