US Video Game Spending Jumps 30% in Q1

Continued Growth in US Video Game Spending

Despite the gradual return to normalcy following the pandemic within the United States, consumer expenditure on video games continues to rise. A significant portion of the substantial gains observed last year can be attributed to widespread stay-at-home orders implemented across the nation and globally.

Overall, the U.S. video game industry experienced a 27% increase in spending throughout 2020.

Sustaining Momentum and Q1 2021 Results

A key question persists regarding the industry’s ability to sustain this upward trajectory as individuals resume more frequent outings. Currently, however, the outlook for the industry remains positive.

NPD reported today that U.S. spending in this sector increased by 30% year-over-year for the first quarter of 2021, reaching a total of $14.92 billion.

Analyzing the Spending Breakdown

A closer examination of these figures reveals that the growth extends beyond simply pandemic-related entertainment. Spending on content increased by 25% during the quarter.

Furthermore, accessories saw a jump of 42%, and hardware sales rose by an impressive 82%.

The Impact of Next-Gen Consoles

The reason for the substantial increase in hardware sales is readily apparent to those familiar with the gaming landscape. While Nintendo’s Switch held prominence for much of 2020, both Sony and Microsoft introduced their next-generation consoles in late 2020.

Analyst Mat Piscatella stated in a press release, “We are still observing heightened levels of both engagement and spending stemming from shifts in consumer behavior caused by the pandemic, but we are also witnessing cyclical growth from the November launches of the PlayStation 5 and Xbox Series consoles.”

Piscatella continued, “The growth spurred by these new platforms, coupled with gains in mobile, PC, and VR content spending, alongside the ongoing success of the Nintendo Switch, has propelled the market to unprecedented levels.”