Will Video Games Continue Growth, Even Against Tough Comps?


One of the sectors to see massive growth during the COVID-19 pandemic was video games. The strong year-over-year increase in spending in the sector created optimism for many companies but also created some tough comparable sales.

Strong second-quarter growth in the sector could show that the strong growth could continue even as the economy reopens.

What Happened: Video game sales were up 2% year-over-year to $14 billion in the second quarter, according to data from NPD Group.

The PC, cloud, mobile games and non-console content sub-sectors all saw growth in the second quarter. Console sales and accessories experienced a drop in revenue in the second quarter.

Video game content sales topped $12.5 billion in the quarter, up 2% year-over-year. Hardware sales were up 12% in the second quarter year-over-year. Accessory sales declined 11% year-over-year in the second quarter.

Mobile games were up 5% year-over-year in the second quarter with multiplayer games making up seven of the top ten earning titles in the quarter.

“Despite changing pandemic conditions across the country, video games spending remained strong in the second quarter of 2021,” NPD Group’s games industry analyst Mat Piscatella said.

Related Link: 2 Video Game Stocks To Buy And 1 To Watch For Strength In Sector Says Analyst

Why It’s Important: Last year’s second quarter saw video game sales up 47% year-over-year.

The new figures from NPD show that the video game market has sustained strong consumer spending in the sector and certain parts of the gaming market actually grew on the inflated pandemic numbers.

Bestselling games in the quarter included “Call of Duty: Black Ops Cold War,” “Call of Duty: Warzone,” “Candy Crush Saga” and “Candy Crush Soda Saga,” all from Activision Blizzard, Inc. ATVI.

Other top games included “Garena Free Fire” from Sea Ltd SE and “Grand Theft Auto V” from Take-Two Interactive Software, Inc TTWO.

Other popular games in the second quarter were “Among Us,” “Clash of Clans,” “Fortnite,” “Mario Kart 8,” “Pokemon Go” and “Roblox” from Roblox Corp RBLX.

“Spending in mobile games remains elevated, showing signs of a continuing lift from the surge of new players who flocked to the category beginning in the second quarter of 2020,” Sensor Tower’s head of mobile insights Randy Nelson said.

Nelson sees no indication spending or usage of mobile games will drop in the future.

Photo: "Call of Duty: Black Ops Cold War," Courtesy of Activision Blizzard.

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Posted In: Trading IdeasCall of DutyCandy CrushGrand Theft Auto VMat Piscatellamobile game stocksMobile GamesPokemon GoRandy NelsonSensor TowerVideo Game Stocks
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