Author: DomsPlaying

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Circana Reports U.S. Games Industry Sales Growth in 2023 on Strength of Hogwarts Legacy, Monopoly Go & PlayStation 5

DomsPlaying

That’s right, it’s the final U.S. sales recap of 2023. A bit late, but here we are!

Earlier this month, Circana announced its December and full-year 2023 report on domestic games industry consumer spending. Both respective time frames showed slight growth, thus ending a shaky 12 months on a positive note.

Within the December holiday month, total sales rose a healthy 4% to $7.9 billion. Which means that overall, U.S. consumers spent more than $57 billion across gaming last year, an increase of 1% compared to 2022.

Two segments in Content and Accessories each moved up in the single digits during the year while Hardware output remained virtually flat.

On the premium software side, while Call of Duty: Modern Warfare 3 did secure the top spot in December, it couldn’t quite sell enough to outpace what ended 2023 as the year’s top seller: Hogwarts Legacy.

This win for Warner Bros marks the first time since Rock Band in 2008 that a game not in Activision Blizzard’s Call of Duty shooter franchise or made by Grand Theft Auto developer Rockstar Games led the yearly list. An exceptional, and mostly unexpected until right up until the final month, result.

A huge portion of the Content category is dictated by mobile where Monopoly Go became the big earner for both December and the year as a whole.

Elsewhere, Sony’s PlayStation 5 generated better supply throughout the year and saw consistent demand plus boasted a system-seller in Marvel’s Spider-Man 2, accelerating the family of consoles to best seller for December and 2023 when measured by both unit sales and dollar revenue.

“A 13% increase in spending on digital premium downloads on console platforms helped offset declines in physical software spending,” wrote Circana’s Mat Piscatella when talking about the year overall. “Growth in PlayStation 5 hardware dollar sales helped offset declines across both Xbox Series and Switch.”

No more time to waste. Read on for my full rundown, numbers and all, then a look ahead to 2024!

United States Games Industry Sales (November 26th to December 30th, 2023)

Across all of gaming during the holiday month, spending rose 4% to $7.91 billion. 2023 sales eclipsed $57.19 billion, up 1%. The largest contributor to growth was full game digital on consoles, highlighting the continued buyer shift towards downloads rather than retail purchases.

The biggest category of Content rose 3% in December to $5.73 billion, or 72% of the total which is slightly below the 73% a year ago. In aggregate across all of 2023, it moved up 1% to $47.97 billion. That’s an 84% contribution, same as 2022.

Mobile generated yet another month of gains, this time seeing spending increase 2.7% over the same time last year. All of the Top 10 earners experienced higher contributions than they did during November. December’s leading games were, in order of revenue, Monopoly Go, Royal Match, Roblox, Candy Crush Saga and Clash of Clans.

The report wasn’t specific about mobile’s contribution to the total 12 month period, however it did outline 2023’s Top 10 games by sales, which I’ve listed in full later in the article. Scopely’s Monopoly Go was the winner, followed by Candy Crush Saga and Roblox.

December’s premium software ranks showcased a number of familiar titles that launched in or before the month, with the only new game being Ubisoft’s Avatar: Frontiers of Pandora debuting in the 6th spot. Which I’d call quite a good start for the year’s last major AAA release.

As expected, Call of Duty: Modern Warfare 3 was the holiday month’s best seller. Next up was Super Mario Bros. Wonder moving up a few spots to 2nd, even without digital sales counted. It’s yet another fantastic showing for Nintendo, just ahead of Electronic Arts’ Madden NFL 24 rounding out the Top 3 as the football season entered its home stretch.

Expanding to 2023 as a whole, winner Hogwarts Legacy was the predominant sales story both domestically and around the globe. In addition to leading the annual U.S. chart, publisher Warner Bros claimed it was the world’s best-selling premium game. It generated well over a billion dollars in its first three months, moved 2 million copies globally in December alone and ending the year at 22 million. It’s now above 24 million.

Activision Blizzard claimed three titles in the Top 7, including two Call of Duty iterations in addition to Diablo IV. While technically a down year for the latest Call of Duty installment, this outcome shows the franchise is still among the top commercial successes, plus reveals that players didn’t need to move to the latest version in order to spend big money.

After Madden NFL 24 in third, Marvel’s Spider-Man 2 and The Legend of Zelda: Tears of the Kingdom, both platform exclusives, rounded out the year’s Top 5. Which makes sense for Insomniac Games’ Spider-Man sequel after its record-breaking start. This was especially impressive for Tears of the Kingdom since it’s based solely on retail. That’s right, it was among the year’s five best sellers considering only boxes sold in stores. When these days digital often accounts for half of a title’s units, if not more, this was a momentous feat for Nintendo.

Another fantastic trend was the commercial success of fighting games as both Mortal Kombat 1 from Warner Bros and Capcom’s Street Fighter 6 charted at #8 and #17 respectively. On the Xbox side, Bethesda’s Starfield, while being on Game Pass and seeing a somewhat soured sentiment since the September launch, landed just outside the Top 10 in 11th place.

In addition to the charts based on revenue, Circana shared the most played games of December by Monthly Active Users (MAUs) from each major platform. Fortnite, Call of Duty and, of course, Grand Theft Auto V led on PlayStation and Xbox while Lethal Company, The Finals and Counter-Strike Go 2 saw the biggest engagement on Steam. Huge movers into the Top 10 included PowerWash Simulator at #9 on PlayStation and Goat Simulator at #7 on Xbox. Apparently, lots of people like doing chores or acting a fool in their spare time!

Check below for December and 2023 best seller lists, including the annual Top 10 mobile earners.

Top-Selling Premium Games of December 2023, U.S. (Physical & Digital Dollar Sales):

  1. Call of Duty: Modern Warfare 3
  2. Super Mario Bros. Wonder*
  3. Madden NFL 24
  4. Hogwarts Legacy
  5. Marvel’s Spider-Man 2
  6. Avatar: Frontiers of Pandora
  7. EA Sports FC 24
  8. Mortal Kombat 1
  9. NBA 2K24*
  10. Mario Kart 8*
  11. Super Mario RPG Remake*
  12. Sonic Superstars
  13. Minecraft
  14. God of War Ragnarök
  15. Star Wars Jedi Survivor
  16. Elden Ring
  17. The Legend of Zelda: Tears of the Kingdom*
  18. Just Dance 2024 Edition
  19. Assassin’s Creed Mirage
  20. UFC 5

Top-Selling Premium Games of 2023, U.S. (Physical & Digital Dollar Sales):

  1. Hogwarts Legacy
  2. Call of Duty: Modern Warfare 3
  3. Madden NFL 24
  4. Marvel’s Spider-Man 2
  5. The Legend of Zelda: Tears of the Kingdom*
  6. Diablo IV
  7. Call of Duty: Modern Warfare 2
  8. Mortal Kombat 1
  9. Star Wars Jedi Survivor
  10. EA Sports FC 24
  11. Starfield
  12. Super Mario Bros. Wonder*
  13. Resident Evil 4 Remake
  14. MLB The Show 23^
  15. Dead Island 2
  16. Final Fantasy XVI
  17. Street Fighter 6
  18. Elden Ring
  19. Mario Kart 8*
  20. Minecraft

Top-Selling Mobile Games of 2023, U.S. (Revenue):

  1. Monopoly Go
  2. Candy Crush Saga
  3. Roblox
  4. Royal Match
  5. Coin Master
  6. Pokémon Go
  7. Gardenscapes
  8. Jackpot Party Casino Slots
  9. Township
  10. Evony

Swapping over to the Hardware category, this one gained 4% in December to almost $1.6 billion.

Circana’s report pointed out that PlayStation 5 and Xbox Series X|S generated revenue growth during the final month of 2023, while Nintendo Switch saw a double-digit percentage decline. That’s good news for Microsoft’s platform, even if it was spurred on by temporary price reductions. The last part there for Nintendo was mostly anticipated for the aging device, which is long past market saturation.

There’s no indication if the growth for either PlayStation or Xbox was in the double digits, however I’d imagine it was in the single digits since the report probably would have said so otherwise.

Topping the hardware list for December by units and dollars was, yet again, Sony’s PlayStation 5. I believe it won every month of 2023 except for May, when Nintendo Switch led on the heels of Tears of the Kingdom’s launch. In fact, Sony as a manufacturer generated a single month dollar sales all-time high in December, outpacing the prior record holder of December 2022.

Intriguingly, Nintendo Switch secured second place in December by units and revenue despite Xbox’s growth and the below comment from Circana.

“Xbox Series X|S set a new lifetime high in U.S. unit sales during the month of December,” Piscatella said on social media, documenting a new milestone for Microsoft’s latest console family. “The previous unit sales high for Xbox Series X|S was set in December 2021.”

After spending most of the year in the red, the Hardware segment’s solid holiday result moved it up to flat for the year at $6.59 billion in consumer buying.

PlayStation 5 topped the annual list by units and dollars. In fact, it was the only platform that gained ground when compared to 2022. Nintendo Switch was again the runner-up by both measures, as both Switch and Xbox Series X|S experienced declining annual sales.

Fitting with the general theme I’ve outlined in these write-ups before, 2023 was a banner year for PlayStation while Xbox maintained its inconsistency, although the latter did have certain bright spots in Starfield’s launch in September and holiday sales when discounted.

Accessories is up next, the final and fastest-growing of the three categories during both the holiday and 2023 overall.

During December, spending in this area rose 14% to $584 million. That’s a super healthy boost during the final month as people who purchases new generation consoles are now scooping up peripherals, including special editions and high-end controllers.

United States buyers purchased $2.64 billion accessories during the year, an increase of 4%. The report shouted out growth from game pads in particular.

Fitting that theme, Sony’s PlayStation 5 Dual Sense Edge was the top-earning accessory of 2023, after the premium pad won most months. Its continued momentum shows there’s ample demand for premium priced peripherals as the console cycle matures.

From a domestic spend perspective, 2023 was the definition of up and down, at least compared to the prior year. Exactly half of the twelve months showed spending growth, while all others saw lower sales than their 2022 counterparts. Only two months, May and September, produced double-digit gains.

There was a distinct lack of consistency, even with blockbuster launches and Sony’s concerted effort to produce more PlayStations. A return to hardware supply helped, as did mobile’s better contribution. Still, Nintendo Switch is long in the tooth, subscriptions are stagnant and the most recent Call of Duty installment under-performed.

“Subscription growth has flattened,” Piscatella wrote on Twitter. “And subscription services on console and PC platforms accounts for only 10% of total video game content spending in the U.S.”

In a broader historical sense, over a timeline including before COVID, it was still one of the best years of consumer spending in tracked history. Unfortunately, spending remains in stark comparison to the games industry labor market, which suffered a record number of layoffs globally in 2023 and is only accelerating early this year.

Speaking of 2024, it’s now time for my official predictions. I wrote a whole article with my expectations across the global industry, so here I’ll focus on solely what I expect from the domestic Circana reports before signing off.

In general for spending and where it’s going, I’m leaning towards keeping with my global prediction in that I expect the year to be close to flat with slight upside in the low single digits. That does include my assumption that Nintendo will in fact launch a Switch successor in the final calendar quarter.

Premium software is somewhat tricky considering the release slate is up in the air, especially for PlayStation and Nintendo. I think the rumored Call of Duty: Black Ops Gulf War will bring the franchise back to best seller status.

Beyond the sports games that will always appear, Star Wars Outlaws from Ubisoft will compete for a Top 5 spot if it’s out, as will a mainline Super Mario assuming it launches with Super Switch. Final Fantasy VI Rebirth has a good chance at Top 10 even on a single platform, and Tekken 8 will have a strong showing in the Top 15. I’m not expecting Marvel’s Wolverine to be out and don’t know what the heck to think about Suicide Squad Kill the Justice League, so I’ll say that one misses the Top 20. Just like Skull & Bones.

Hardware will be a juicy category. It’s almost a lock that Super Switch will be out in the back half. I’m on record saying I think adoption will start a tad slower than the original, then pick up over time. Considering Sony’s push to produce PlayStation 5 to make up for lost time during the pandemic, and its at least six to eight month head start, my bet is PlayStation 5 will take home hardware for 2023 with Nintendo as a close second, especially on units.

And, of course, I couldn’t leave without mentioning Palworld! I believe January’s big sales surprise, moving 8 million copies on Steam and topping the Xbox Game Pass list during its debut week, will be among 2024’s most-played titles. Especially if it leaves early access and launches on PlayStation.

That’s officially it for 2023. I highly recommend checking out Piscatella’s Twitter thread for the full Circana report, including individual platform charts and more engagement stats.

Be well, and see you soon for more this year!

Note: Comparisons are year-over-year unless otherwise noted.

*Digital Sales Not Included

^Xbox & Nintendo Digital Sales Not Included

Sources: Circana, Warner Bros.

-Dom

Seven Major Games Industry Predictions for 2024

DomsPlaying

Now that I’ve looked back with my 2023 Year-in-Review, which I still highly recommend reading to catch up on trends, games and studios you might have missed, it’s officially time to move into the new year!

After a legendary twelve months of game releases amidst a disastrous time for the industry’s labor market, I believe uncertainty and volatility are set to define 2024. There will be challenges, and plenty of them, yet also select opportunities on which to capitalize. I see a future with new hardware, labor issues and new service launches from key players, among other things.

Rather than make general statements, which are far too easy, I try to make my predictions quantifiable somehow, or at least be as specific as I can, to hold myself accountable. Plenty of people make predictions; not many grade themselves. For instance, here’s my results from last year:

  • Microsoft & Activision Blizzard Deal Closes in Calendar 4th Quarter: Correct.
  • Nintendo Goes Another Year Without Announcing a Switch Successor: Correct.
  • Global Games Industry Value Returns to Growth & Passes $188 Billion: Partially Correct.
    • It grew, albeit not as much as I expected.
  • PlayStation 5 Wins Best-Selling Console in the U.S. Yet Misses Sales Targets: Correct.
    • Well, so far. I would also argue Sony is tracking below its PlayStation 5 fiscal target.
  • Xbox Game Pass Price & Subscription Base Increases: Partially Correct.
    • Cost to consumer went up, though Microsoft refused to share user base stats.
  • Special Year of Fighting Game Releases & Announcements: Correct.
  • Amazon Games Makes Massive Studio Acquisition: Incorrect.
  • Bonus: Bungie Announces & Launches Destiny Universe Transmedia Property: Incorrect.

Not bad, right! Now, check a look below for seven predictions for 2024 covering the games industry at large. Plus, as usual, a super bold bonus guess mostly for fun.

Happy New Year everyone.

Super Nintendo Switch & New 3D Mario Release in Fourth Quarter

I’ll get an obvious one out of the way. In fact, I’ll make it a bit harder by attempting to guess exact things for what’s inevitably going to be the year of Nintendo’s next hardware launch. The company’s next hardware will be called Super Nintendo Switch. It will again have a hybrid portable and console setup, will launch with one model in October, and cost $400 to start.

Alongside, Nintendo will product a mainline 3D Mario as a launch title. It won’t be a sequel to 2017’s Super Mario Odyssey. It will be an open world with various areas and secret levels. It will be called Super Mario [Something] 3D. In addition to this, I’m guessing a motion game launches day-and-date plus a mainline Animal Crossing and Mario Kart will both be out within its first year. The device will, after a somewhat slower start as adopters move on, end up following a similar trajectory as its predecessor within three years. That’s right, I’m officially done underestimating Nintendo.

Difficult Labor Market Continues as Major Publishers Reduce Workforce

This is absolutely the most painful prediction to write, mainly because it’s a carry-over from last year that I don’t think will stop any time soon. During January to December 2023, Games Industry Layoffs estimated that upwards of 9,000 jobs were cut across the sector. I believe that anyone hoping for a more cheerful 2024 for hiring or even stability will, unfortunately, be disappointed.

After years of low interest rate borrowing, higher-than-usual consumer demand and expansion by many firms, I’m expecting even more layoffs and even studio closures in 2024, especially at the top-end, AAA level. Within the first week of January alone, Surgeon Simulator maker Bossa Studios laid off a third of its employees and further losses were reported at Embracer Group’s 3D Realms and Slipgate Ironworks. I believe we’ll see a further contraction of more than 3,000 to 5,000 jobs, with at least two major publishers announcing 5% to 10% workforce reductions.

Microsoft Xbox Mobile Store & Big Name Activision IP Announcements

Here’s a two-for-one. A natural progression of Microsoft’s service-oriented strategy will be developing a dedicated Xbox mobile distribution platform that integrates Game Pass and cloud offerings. I anticipate it will both reveal and release this sort of storefront in 2024, let’s say between June and December. It will simply be called Xbox Mobile. This move is advantageous from various perspectives, in particular for maximizing platform fees, diversifying its offerings, controlling content flow, appealing to potential partners and expanding its audience base across devices. Can it truly compete with Apple and Google’s market share? Well, you won’t see me betting on that.

That brings me to the second part of the prediction: Now that the Activision Blizzard deal is done, I believe the team will revive certain brands, especially those that can round out the Game Pass portfolio and even crossover to mobile. Within the next 12 months, I’m thinking the team will announce the following: new Skylanders and Tony Hawk’s Pro Skater iterations, both being ongoing platforms and revenue generators. Once the mobile store and larger brand IP are established, Xbox will move into Spyro the Dragon and Phil Spencer’s beloved Hexen, which I don’t expect to be revealed until at least 2025. I’m much more skeptical on others, for instance a Guitar Hero revival.

Sony Launches PlayStation 5 Pro & Spider-Man 2 Expandalone in November

Not to be outdone by Nintendo, I’m thinking fellow Japanese hardware maker Sony kicks off its mid-generation console refresh this year. While it feels like just yesterday the platform holder launched the PlayStation 5, partly because of a global pandemic making the passage of time irrelevant, it’s now over three years into the latest cycle. Thus, I’m expecting a boosted PlayStation 5 Pro announcement sometime in the third quarter and a quick turnaround to release in the beginning of November 2024.

Along these lines, I’m going to say star studio Insomniac Games is cooking up what I call an “expandalone” for its 2023 hit Marvel’s Spider-Man 2, similar to the Miles Morales counterpart to 2018’s Marvel’s Spider-Man. (Mild spoiler warning!) This will be a solid 8 to 10 hour experience, it will hit market on the same exact day as the new console model, boast a range of performance options to show off the fancy tech and feature the webbed buddies facing off against Carnage as the primary villain.

Total Global Games Industry Value Will Remain Virtually Flat

In the last quarter of 2023, NewZoo estimated the global games industry did exhibit growth during the year even with a slew of challenges, moving up under a percent to $184 billion in value. The largest contributor of Mobile accounted for over $90 billion, down 2% as this segment stagnated during the year. It was Console and PC software, including full game digital downloads, driving upward momentum with those segments moving up 5% and 2%, respectively.

This year, I’m leaning towards caution for 2024 and think the global industry will remain virtually flat, with slight downside in potential negative territory. This would be notable as only the second decline of the last 16 years, alongside 2021 to 2022. I am guessing $183 billion to $184 billion for the full year. Partly because of a tough comparison against a stacked release calendar, between the out-performance of Hogwarts Legacy and The Legend of Zelda: Tears of the Kingdom among others. I expect minimal mobile momentum to remain, as well as subscription stagnation and a heavy reliance on a new Nintendo console that could have a slower adoption rate. There is some decent upside if my PlayStation 5 Pro prediction hits, because I do expect a good holiday season for Sony regardless.

AI Usage Ramps as At Least Two Big Titles Embrace Generative Voice & Writing

It’s time for the dreaded buzzword bro: Artificial Intelligence! As much as people don’t like AI, or misuse the term, it’s part of our collective future and is already an integral part of making games. It has been for a while within an industry that blends art and technology, as various notably projects have already used some form of it to assist human developers. Recent examples include Ubisoft writers leveraging it for non-playable character chatter, Squanch Games having AI artwork in High on Life and The Finals from Embark Studios features generative text-to-speech.

I expect this sort of AI-assist development tech to take an even more prominent role in 2024. How will I quantify this prediction? I believe that at least two major publisher titles will heavily feature something like AI-enhanced primary characters or substantially aiding the writing team with main or side quest lines. Candidates include Ubisoft, Square Enix and even PlayStation Studios, the last of which has done great work with accessibility features, a fantastic opportunity area for this exact sort of development workflow enhancement.

M&A Cautiously Continues With Acquisitions by Saudi Arabia’s Savvy Games & Netflix

Last year’s merger and acquisition (M&A) valuation was skewed by Microsoft’s monumental $69 billion takeover of Activision Blizzard. Before that closed in October, companies weren’t as active in terms of deal value through the first nine months of 2023 according to a global report from Drake Star. There were 746 deals valued at $18 billion, down from 626 deals at $51 billion during the same time in 2022. Similar to my sentiment right now, there’s a lot of uncertainty around things like rates and jobs, which is why I believe that 2024’s deal landscape will be selective rather than massive.

Even so, there will always be moves made by key players. I expect a couple of those to be Savvy Games and Netflix. The former is the gaming investment vehicle of Saudi Arabia’s government, which is throwing cash at various sectors including tech, while the latter is hellbent on pushing games to its millions of subscribers. Might a name like CD Projekt be appealing to these kinds of buyers after a stock price decline? (I’d say so.) Might a platform holder named Sony be interested in spending big bucks on a Ubisoft or Capcom? (Eh, I don’t think so.) Finally, which business will Embracer spin off to pay down its debt and which company might subsequently buy them? (I’d wager Gearbox Entertainment or Coffee Stain, or both.)

Bonus & Bold: Bungie Concludes The Final Shape With Destiny 3 Announcement

That’s right, it’s time to finish with a pipe dream! Yes, it’s a mostly absurd one. It’s something I want more than expect to happen. I acknowledge Bungie got rid of a reported 100 folks, or 8% of staff at the time, back in October. It’s making a huge push towards The Final Shape expansion, the huge finale of Destiny’s decade-long saga. A good portion of the team is actively focusing on extraction shooter and likely 2025 launch Marathon.

I’d still wager the talented folks at Bungie are drafting up something more substantial for the future of Destiny that isn’t just the announced periodic episodes once the latest expansion concludes in June. Plus, it’s a bloated game with a reportedly dated development process that drastically needs a reset. Which is why I think the third mainline Destiny franchise title will (realistically probably not) be announced this year, and (is super unlikely to) launch subsequently in 2026!

Note: Comparisons are year-over-year and dollars are in US$ unless otherwise noted.

Sources: Bloomberg, Company Investor & Media Websites, Drake Star, Drexel News Blog (Image Credit), Games Industry Biz, NewZoo, Video Games Chronicle, VideoGameLayoffs.com.

-Dom

2023 Year-in-Review: Dom’s Top 10 Games of the Year

DomsPlaying

It’s the final day of 2023, what was a difficult year for the industry yet an incredible time for the games it produced, as you’ll see shortly when I describe my favorite experiences.

In my last post of this latest Year-in-Review series, and of 2023 itself, I’ll run down the ten best games I played then throw in five honorable mentions to celebrate even more developers.

Many folks are calling it the best year in gaming. I even posited if it might be in my 2023 trends recap. While I don’t know about that, since there’s an element of recency bias inherent in that argument, the quality was consistent across various genres at both triple-A and indie levels.

The ranks of my list this year include genres like computer RPG, third-person action, cooking sim, rhythm brawler, vania, soulslike, fishing adventure and survival horror.

For context, by my count I tried over 60 new games during the last 12 months. Whew. Talk about a busy one!

Raise a toast to the winners below, and enjoy your New Year everyone!

Dom’s Top 10 Games of the Year 2023

10. Remnant 2 (Gunfire Games, Gearbox Publishing)

Platforms: PlayStation 5, Xbox Series X|S, PC.

The sequel to 2019’s excellent, often overlooked Remnant from the Ashes went even bigger than its predecessor with its approach to narrative delivery and world-building, offering three bespoke areas to explore and bosses to defeat while keeping the crunchy core mechanics that make the series so enjoyable. Plus, who doesn’t love a game that offers a character class where you have a doggo friend that has skills, bites enemies and revives you?

9. Hi-Fi Rush (Tango Gameworks, Bethesda Softworks)

Platforms: Xbox Series X|S, PC.

The latest from Tango, known better for survival horror than action, came out of nowhere back in January as it stealth dropped on the day it was announced, resulting in a music action game that’s an easy contender for Surprise of the Year. Its characters are endearing while they navigate a syncopated, anti-corporate world that moves to the beat, offering an accessible path to the rhythm genre while incorporating platforming and a competent combat system within Bayonetta-esque battle arenas.

8. Marvel’s Spider-Man 2 (Insomniac Games, Sony Interactive Entertainment)

Platforms: PlayStation 5.

PlayStation owns a number of premier studios and Insomniac is its most prolific, producing a fantastic sequel that tells its own tale of heroes and villains while perfecting the traversal for which the modern Spidey series is now known, notably via its new wing suit. High production value shines in set pieces, visual flair and technical prowess as the team gives equal weight to the relationships, stories and personal moments for Peter and Miles as it does their suite of abilities to fight for their beloved New York City neighborhoods.

7. Alan Wake 2 (Remedy Entertainment, Epic Games Publishing)

Platforms: PlayStation 5, Xbox Series X|S, PC.

Over a decade in the making, Alan Wake 2 elevates beyond the innovative 2010 original to something that truly exists between indie film and brain-bending horror, a celebration of the auteur that forgets any boundaries of what an interactive medium can be. Even if it self-indulges into bonkers territory down the stretch, Remedy produced a gem, featuring at least two of 2023’s best sequences within its “We Sing” and “Old Gods” chapters.

6. Lies of P (Round8 Studio, Neowiz Games)

Platforms: PlayStation 5, PlayStation 4, Xbox Series X|S, Xbox One, PC, Mac.

I was sold on Lies of P since the moment Round8 Studio unveiled the “Pinocchio-souls” concept, and it managed to exceed expectations, moving beyond its inspirations to achieve its own high bar of quality that stands out among pretenders in the space. Its world is gritty, aesthetic is relentless, enemy design is impeccable and its twist on customization, especially being able to swap weapon parts to fit one’s build and change out P’s prosthetic arm, prove it has all the makings of a genre classic that isn’t made by FromSoftware.

5. Dave the Diver (Mintrocket, Nexon)

Platforms: Nintendo Switch, PC, Mac.

It it indie? Is it AAA? As long as you say Dave the Diver amazing, I don’t care what you call it. In a year of standout fishing games, Mintrocket hooked a spot in my Top 5 because it manages to make water levels both engaging to explore and easy to traverse with its fluid controls and nifty ability system, then deftly layers on a restaurant management simulator and a story centered around ecological rejuvenation.

4. Super Mario Bros. Wonder (Nintendo)

Platforms: Nintendo Switch.

The latest Super Mario installment is joyful, quirky and constantly charming while retaining the pinpoint precision of a proper platformer. Nintendo offers a suite of levels from novice to uber challenging, a plethora of playable characters (including kid-friendly ones) and both co-op and online multiplayer. Super Mario Bros. Wonder is a collector’s dream, adding a snazzy badge system with charged up abilities that only enhanced its masterful mechanics, running neck-and-neck with the classics as the franchise’s best 2D effort in over three decades.

3. Cocoon (Geometric Interactive, Annapurna Interactive)

Platforms: Nintendo Switch, PlayStation 5, PlayStation 4, Xbox Series X|S, Xbox One, PC.

Made by one of my indie studios of the year in Geometric Interactive, Cocoon is an instant success in the puzzle space, expertly executing its worlds-within-worlds mechanic while coaxing the player to feel like a genius with the lightest of touches. While its terrific art direction blends organic with robotic, its design smartly and subtly signals where and how to move through levels, the rare puzzler that doesn’t ever require a walkthru and never feels frustrating. My only minor complaint is I wish it had a sprint or dodge button; otherwise, it’s immaculate.

2. The Legend of Zelda: Tears of the Kingdom (Nintendo)

Platforms: Nintendo Switch.

They’ve done it, yet again. Tears of the Kingdom ignores the massive expectations Nintendo itself set with the legendary Breath of the Wild, building on the foundation with a suite of interactive tools that would break a lesser game. Nintendo offers a chance to combine almost any item to form something new, build out massive machines, teleport through geometry and jump from the sky to depths in one fell swoop. The result is hilarious failure and constant fun.

Tears of the Kingdom is more about dominating a well-trodden map and familiar mechanics as Link gathers a team and connects a world to fight another imminent threat from his eternal rival. There’s an entire underground that mirrors the surface world, ramping up the survival aspects, plus a myriad of sky islands and cave systems to loot. The latest Zelda boasts some of the series best moments between its “Guidance from Ages Past” quest-line and an epic, emotional Master Sword set piece. The essence of adventure is at its best in this superb sequel that might top this list if it came out any other year.

  1. Baldur’s Gate 3 (Larian Studios)

Platforms: PlayStation 5, Xbox Series X|S, PC, Mac.

The industry never ceases to amaze and astonish, as I never thought I’d ever write this: Baldur’s Gate 3 is my Game of the Year. That’s saying something, and tells you just how special it is. I’ve never played Dungeons & Dragons in my life. I’m not the target audience of this kind of crunchy, turn-based role-playing game. What drew me in, and what made it my favorite game of 2023, is the writing, characters, world and exploration. It entranced me, as if under a spell, weaving its tendrils into my very soul.

Very few experiences have the sort of lasting effect, and I still haven’t even finished its last act!

The sheer size and breadth is breathtaking, without being bloated. Every part has been developed with intention. Baldur’s Gate 3 rewards consideration of every action, every relationship, every decision with the utmost care, as much as Larian Studios itself put into making a game of this miraculous scope and, frankly, absurd depth. I can’t begin to calculate the permutations, how every playthru will be personal yet all will have a similar level of quality.

For instance, my paladin rolls with tiefling barbarian Karlach, who is also my romantic partner, high elf rogue Astarion and half-elf cleric Shadowheart, alternating in the druid Halsin or fighter Lae’zel. I’ve heard of people turning these characters away, even killing them, all equally valid ways to progress! It’s not one of those games that pretends decisions mean something. It’s not Mass Effect with paragon versus renegade. It’s fluid. Dialogue and storylines react. Choice is everything.

I will say, it’s not perfect. The first act is the most polished, and there’s been plenty of bugs and save issues documented where Larian continues to issue patches fixing technical issues. Still, the fact that the story of this game is so positive even with these hiccups is a testament to its status as a masterpiece.

Similar to my 2018 winner Red Dead Redemption 2, it’s the exquisite attention to detail, the care put into every interaction, the nooks and crannies of the map that have their own stories, all of these and plenty more elevated Baldur’s Gate 3 to the top of this list, eternally cementing its place in history.

Honorable Mentions (Alphabetical):

Armored Cored VI: Fires of Rubicon (FromSoftware, Bandai Namco)

Platforms: PlayStation 5, PlayStation 4, Xbox Series X|S, Xbox One, PC.

Chants of Sennaar (Rundisc, Focus Entertainment)

Platforms: Nintendo Switch, PlayStation 4, Xbox One, PC.

Dredge (Black Salt Games, Team17)

Platforms: Nintendo Switch, PlayStation 5, PlayStation 4, Xbox Series X|S, Xbox One, PC.

Tchia (Awaceb, Kepler Interactive)

Platforms: PlayStation 5, PlayStation 4, PC.

Thirsty Suitors (Outerloop Games, Annapurna Interactive)

Platforms: Nintendo Switch, PlayStation 5, PlayStation 4, Xbox Series X|S, Xbox One.

Sources: Company Media Websites.

-Dom

2023 Year-in-Review: Independent Game Studios of the Year

DomsPlaying

The next category in my prominent and distinguished 2023 Year-in-Review series is ready!

It’s a personal favorite, and an honor to share: Independent Game Studios of the Year.

First off, I don’t set an explicit definition of what’s indie and what isn’t. That’s an exercise in futility, and driven by semantics. I know an indie when I see it.

For instance, as awesome as Dave the Diver is, it won’t be among these ranks. The studios and projects celebrated here are (usually) not owned by a mega publisher, tend to be smaller in scope, team size, budget or all of the above plus feature an aesthetic or design that’s alternative to the traditional AAA space.

That’s my criteria and I’m sticking to it.

It’s exceptionally difficult to whittle this list. After all, there’s a metric ton of incredible indie teams that put out a myriad of games in a given year. Which means I do however many I want. It’s my site. Plus, rules are mostly arbitrary anyway.

For this year’s installment, I’ve shouted out 12 developers from 8 different countries that excelled within the indie space. One for each month, I suppose.

On to the winners, in alphabetical order!

Awaceb (Canada)

This studio of a dozen or so people based out of Montreal was started back in 2016 by Phil Crifo and Thierry Boura. This year, its wholesome and inspired open world adventure Tchia tells a great local story based on the founders’ home nation of New Caledonia, has moved over 1 million units and secured the Games for Impact award at December’s The Game Awards.

Black Salt Games (New Zealand)

This team made up of four Kiwi collaborators in Joel Mason, Nadia Thorne, Alex Ritchie and Michael Bastiaens kicked off making their debut title Dredge in 2020. It’s a twisted take on an open world water tale, merging cosmic horror with nifty fishing mechanics, standing out as one of 2023’s premier, and eternally spooky, experiences while cruising past the million copy sold milestone.

Enhance Games (United States)

Back in 2014, industry veteran Tetsuya Mizuguchi founded Enhance, a creative studio that melds various forms of reality gaming and sensory experiences to make titles like Rez Infinite and Tetris Effect. This year it launched Humanity, a dreamy flow-of-consciousness in which a spirit pup leads human souls to complete puzzles, expanding its already impressive and unique portfolio.

Geometric Interactive (Denmark)

Based out of Copenhagen, Geometric is a focused group led by Jeppe Carlsen and Jakob Schmid, both formerly of Playdead (Limbo and Inside) and it shows with their first effort Cocoon. Remember this world-bending environmental puzzler, which took home Best Debut Indie Game at The Game Awards among other accolades, as it will certainly show up again in my Game of the Year article.

Kinmoku (Germany)

Among my favorite things is shouting out single developer studios, and that’s the case here with Lucy Blundell aka Kinmoku who left AAA publishing in 2015 to pursue an indie career. After launching One Night Stand in 2016, they found an even bigger audience recently with Videoverse, a nostalgic, narrative homage to online communities of yesteryear distinguished by its striking visual style.

Mojiken Studio (Indonesia)

This prolific, tight-knit squad is based out of Surabaya and defines its work using a pixelated approach that’s comforting and aesthetically pleasing. 2023’s gem A Space for the Unbound is set in its native Indonesia and expands on its ethos, offering a heartfelt story about teenage love and spiritual growth layered on a supernatural backdrop.

Outerloop Games (United States)

Co-founder Chandana Ekanayake is the creative lead behind the fully distributed and minority led Outerloop Games, previously best known for 2019’s Falcon Age. The group’s fantastic 2023 title Thirsty Suitors is a highlight of inclusivity and culture, both dramatic and romantic, with its snappy animations, wonderful writing and a sublime coexistence of narrative and mechanics.

Rundisc (France)

This team located in Toulouse now has a couple releases under its belt, launching Varion in 2018 and the exceptional Chants of Sennaar back in September in what showcased their immense talent. It’s a miraculous entanglement of peoples and politics told through deciphering of language, showing there’s always a path towards mending fractured relationships even amidst all the challenges that inevitably present themselves.

Sabotage Studio (Canada)

Thierry Boulanger and Martin Brouard formally spawned Sabotage back in 2016 after painstakingly prototyping what would become 2018’s action platformer The Messenger. The team grew in size over time then went a different route with this year’s Sea of Stars, a magical turn-based title that keeps the tradition of retro RPGs alive while enhancing the formula with modern trappings, attracting 4 million players along the way.

Sad Owl Studios (Scotland)

This team’s first effort Viewfinder was initially started by Matt Stark back in 2019, after which his studio Robot Teddy was purchased by Thunderful then renamed Sad Owl Studios. The level-based first-person walker features perhaps the most innovative concept in gaming this year, whereby the player takes pictures that shape the environment in a mesmerizing display that truly has to be experienced to be believed.

Tour de Pizza (United States)

This is a fun one, considering its studio name and cartoonish creation are based on the most perfect food ever created by humans. A group of folks including online personas McPig and Sertif spent five years making what’s probably the goofiest entry here in Pizza Tower, a sharp, sometimes masochistic, high-paced platformer featuring main character Peppino Spaghetti that keeps speed-runners and pain lovers alike salivating similar to its namesake.

Visai Games (Canada)

The final entry also prominently features food, albeit in a much more familial and familiar setting, cooked up by the intimate team at Visai Games out of Toronto. Led by art director Sam Elkana and writer slash producer Shahrin Khan, the delightful Venba is about the ups and downs of an Indian family living in Canada and centers around meals, identity and maturing in a place that isn’t necessarily home, yet can be over enough time.

Sources: Studio Media Relations Websites, Gamatomic (Image Credit), Game Informer (Image Credit).

-Dom

2023 Year-in-Review: Five Most Impressive Gaming Companies & The People Who Defined Them

DomsPlaying

Continuing the site’s prestigious Year-in-Review series, I’m back with an enhanced category this year that expands on my history of shouting out the developers and publishers that defined the industry the past year.

These are five of the most impressive companies that operated in the gaming space during 2023, leading the charge on what was an extremely strong year of titles. These can be developers, publishers, hardware makers and more.

Plus, fitting the theme of celebrating those that worked hard on putting out great games or related products this year. I’ve added a portion to shout out at least a couple folks at each firm integral to the projects these companies have produced. Companies aren’t monolithic. They aren’t the building, logo or executives. They are people.

Note this is usually reserved for larger, often publicly-traded, firms. I have a separate post incoming soon running down the incredible indie studios that launched amazing games in 2023 as well.

Here’s the full list, in alphabetical order!

Capcom (Japan)

Long-time Japanese publisher Capcom continued its resurgence this past year, launching two of the industry’s most recognizable, outstanding experiences. First in May, teams teams put out a remake to the classic Resident Evil 4, an enhanced version of the already classic survival horror game, becoming one of the fastest-selling Resident Evil titles and scooping up various accolades.

Then there was Street Fighter 6 in June, a return-to-form for the fighting franchise that captivated fighting games and a more casual audience. Plus, September’s Monster Hunter Now was one of my favorite mobile titles of 2023, an exceptional adaptation of the formula to a new set of devices.

Special kudos to Street Fighter 6 director Takayuki Nakayama and art director Kaname Fujioka. These two guided the general design and art of one of Capcom’s fastest-selling fighting games, and a competitive platform that will be heavily featured in official tournaments and off-book battles for years to come.

Insomniac Games (United States)

The team at Insomniac Games single-handedly carried PlayStation’s first party output in 2023, launching a major sequel in its beloved modern Spider-Man series in collaboration with one of last year’s winners in Marvel Entertainment. Plus, it showed resilience earlier this month when hackers breached its data in a cruel criminal act that rocked the industry.

Marvel’s Spider-Man 2, which had the single biggest 24 hours of sales in PlayStation history when it released in October, felt like the pinnacle of the studio’s ethos. It’s a free-flowing take on the comics with its own spin on the hero’s journey that features both Peter Parker and Miles Morales, plus the villainous Venom which is the star of the title’s most exhilarating sequence. It’s a, hm, marvel of technical prowess and smart accessibility, with the snappiest loading and finest traversal of any game this year.

Creative lead Bryan Intihar was wonderfully sharp and candid in interviews, clearly exhibiting his deep love for the series and studio’s legacy. I’d also like to call out Senior Community Manager Aaron Jason Espinoza who runs the developer’s social accounts and is a solid follow himself.

Larian Studios (Belgium)

It was a Larian Studios world in 2023, everyone else was just living in it. The 400-person Belgian team’s appearance here comes on the strength of Baldur’s Gate 3, a decade plus effort that started in early access back in 2020 then fully launched this year in August to widespread critical acclaim and highly-deserved commercial success.

The instant classic has already won multiple Game of the Year awards, and will contend on my list when I finish it up, redefining the computer role-playing space with its scope, breadth and utter audacity of ways to play, reacting to player choices like no other game in recent memory.

One of my shout outs has to be Swen Vincke, photoed above, Larian fixture and star of The Game Awards in his shiny armor. Vincke’s talent is outmatched only by his team dedication, posting an endearing set of thank yous on social to those that made Baldur’s Gate possible. Plus, there’s Adam Smith, who led the title’s writing. The sheer amount of dialogue, story beats and permutations is enough to make one’s head spin, and Smith’s team coordinated it brilliantly.

Nintendo (Japan)

In the potential final year of Nintendo’s now illustrious Switch, it brought the heat in a portfolio of games that rival only the hybrid console’s 2017 launch window. May’s The Legend of Zelda: Tears of the Kingdom and October’s Super Mario Bros. Wonder are easy Game of the Year contenders, with the former reaching nearly 20 million units sold already and the latter being the fastest-selling mainline Super Mario.

The company rounded out its 2023 lineup with Pikmin 4, already the franchise’s lifetime top seller, Metroid Prime Remastered, Detective Pikachu Returns, WarioWare: Move It! and Super Mario RPG remake. Then, back in April, it collaborated with Illumination Entertainment on box office blast The Super Mario Bros. Movie, an awesome adaptation that exceeded most expectations both in quality and cash generated.

Usually it’s Shigeru Miyamoto that’s associated with the Italian plumber, and rightfully so. I want to point out the more unsung, tenured heroes on the team in Super Mario Bros. Wonder producer Takashi Tezuka and director Shiro Mouri. Tezuka-san is a living legend, starting at Nintendo a staggering 40 years ago. Dude was assistant director on 1985’s Super Mario Bros. for crying out loud. Mouri-san is a relative “newcomer” who worked on F-Zero during the Nintendo 64 era then certain 2D Mario and Zelda titles. These two have a magnificent track record and helped craft what I think is the greatest side-scrolling Mario since 1990’s Super Mario World (a game that Tezuka-san also led).

Remedy Entertainment (Finland)

If 2019’s Control was Remedy going for mind-bending action, October’s Alan Wake 2 was its foray into classic survival horror, and a monumental one at that. There’s nothing quite like a Remedy game as the Finnish studio’s approach is unlike any other, pushing boundaries of both technical aspects and genre-mashing to form titles that are wholly different and often groundbreaking.

This year’s masterful sequel to 2010’s Alan Wake was the culmination of a 13 year journey for the team, showing a level of sticktoitiveness that plenty of studios would abandon. Alan Wake 2 is an experience that blends suspenseful story, full motion video and over-the-shoulder mechanics in what’s the most uniquely bizarre triple-A joint of 2023.

From the above image are lead writer Sam Lake and Alan Wake 2 director Kyle Rowley, clearly enjoying themselves while winning at The Game Awards. Industry visionary Sam Lake has become the face of the studio and is prominently featured in their games, thus carving carved out a lane for Remedy’s weird, magical approach to design. As for Rowley, if there’s anything that the new Alan Wake installment should be known for in the annals of history, it’s game direction. The definition of an impressive effort by him and his team.

Sources: Company Media & Investor Websites, Kotaku (Image Credit).

-Dom

2023 Year-in-Review: Biggest Trends in Gaming, Tech & Media

DomsPlaying

As I mentioned in my recent Year-in-Review megapost, it’s time to run down and wrap up the year that was 2023.

First up is a recap of the biggest trends across gaming, technology and media that guided the story during the last 12 months, and will have a major impact on the future of these sectors. Better or worse, it was a busy time for those within and following these industries.

Below I’ll go through six of the biggest trends then a bonus for fellow games industry enthusiasts out there. It wasn’t all pretty. In fact, I’d argue it was overall a tough year especially for folks whose livelihoods depend on working in and around technology.

Without further delay, I’ll move right into it. There’s a whole lot of ground to cover after all!

Labor Market, Layoffs, Strikes & Return to Office

One of the main, and disheartening, things that people will remember about 2023 was a broadly decaying labor market. After the pandemic period of easy money and hiring bursts, a correct came this past year as a laundry list of industry-driving companies suffered layoffs or business unit closures. Microsoft, Google, Zoom, Twitter, Yahoo, Vimeo, Hasbro and Tik Tok owner ByteDance cut their respective workforces, some by double-digits. Meta Platforms, Amazon, Spotify and LinkedIn all had two rounds of job cuts. Walt Disney had three.

It’s estimated the tech industry lost a staggering 240K jobs, or 50% more than 2022. The games industry cut almost 10 thousand. It was a painful indication of what can happen when companies over-expand, mismanage or aren’t able to adjust, with lower tier employees suffering more than their C-suite overlords. Plus, those that did remain were forced back to the office, as only 26% of American households have someone working remotely, down from almost 40% in 2021. Roughly 66% of U.S. workers are back to the office full time, up from 41% a year ago. Upside being that unionizing and collective action can work, with the major examples being Writers Guild of America and SAG-AFTRA pressing film and TV execs, a bright spot amidst a difficult year for workers.

Consolidation Continues as Activision Blizzard Joins Microsoft

Merger and acquisition activity heated up this past year, with the global volume of deals jumping 27% to almost $2 trillion in value through just the first three quarters. This came even amidst rising interest rates and volatility in global markets. Within my covered sectors here, there was Broadcom and VMWare, Savvy Games and Scopely, Sega Sammy and Rovio, Oracle and Cerner, Opentext and Micro Focus plus ServiceNow and Era Software.

Then, the corporate saga I’ve been tracking the most closely ended as Microsoft finally closed its purchase of Activision Blizzard in October. It was the finale of a two year-long fiasco of regulatory hurdles, market pressures and data leaks. The nearly $70 billion deal was the largest ever for the games industry, whereby a massive third party software publisher became part of a platform holder, bringing the likes of Call of Duty, World of Warcraft and, quite importantly, mobile titles like Candy Crush into Microsoft’s possession to bolster its Game Pass and cloud services. Best of all, the closure means scummy industry villain Bobby Kotick will no longer run Activision Blizzard, a total win for its employees and culture.

Coming Out Party for So-Called Artificial Intelligence

Artificial Intelligence, shortened to AI, is a phrase used so commonly to describe many things that aren’t actually it, and 2023 was the year where usage of adjacent services or products truly ramped up in the mainstream, moving beyond the dreams of start-up nerds and angel investors. Wikipedia said it was one of the most viewed topics of its online database. Investment flooded into companies specializing in the space, futurists talked of its melding with humanity and governments scrambled to catch up to the pace of progression.

While this partially happened to due to deep fake videos, robo-news stories and computerized music, the real reason was large language models (LLMs). Namely, the chatbot called ChatGPT. Made by OpenAI, a firm mired in controversy that only helped to popularize it, the service accumulated a staggering 100 million users per week this past year. It became a popular tool for students and email writers alike, blasting Open AI’s annual revenue past $1 billion compared to under $30 million in 2022. Everyone is trying to get in on the action, with competitors including Google’s Bard, Meta’s Llama 2 and Bing AI via Microsoft. It’s the easiest entry point for the public to see what certain types of “intelligence” are capable of while projecting a variety of potential futures, some of them dark for the course of humanity.

Rising Streaming Costs & Media Subscription Changes

This could be a recurring category as companies adapt content delivery methods to squeeze consumers for dollars. While moderate inflation, or when prices are generally increasing over time, isn’t necessarily news, 2023 saw outsized “streamflation” in that plenty of major services jacked up rates, some of them multiple times. Netflix, Disney+, Hulu, ESPN+ Spotify and Xbox Game Pass all became more expensive. Apple raised the cost of AppleTV, twice. Amazon reiterated that starting in the new year, Prime Video will have ads and charge a fee for ad-free viewing. Cost savings from cord-cutting just ain’t what it used to be.

Then there’s companies moving to rename, restructure or reorganize their services, adding or consolidating levels such that no one can ever truly keep up. Warner Bros Discovery combined HBO Max and others into Max starting mid-year. Sony wholly rebranded its PlayStation Plus membership system around that time as well. Paramount Global recently announced Paramount+ With Showtime. It’s enough to make your head spin, and your bank account hurt.

Companies & Governments Battle in Court

While I’m not a legal expert, I tend to track certain courtroom tussles that impact major companies because it can dictate the direction of vast industries, the people who work in them and those that spend money on them. Global regulators, especially the U.S. Federal Trade Commission (FTC) and the United Kingdom’s Competition & Markets Authority (CMA) heated up scrutiny, namely around antitrust and merger activity. There was the aforementioned Microsoft and Activision Blizzard deal, plus Meta buying up virtual reality firm Within Unlimited, both of which moved forward despite governmental pressures. Meta also settled anti-privacy lawsuits in 2023, agreeing to pay $725 million yet maintaining claims of no wrongdoing.

Then there’s the historic U.S. antitrust suit against Google alleging a monopoly in online search, which closed arguments in November and has a verdict due likely in the first quarter of 2024. As for companies fighting each other, Epic Games won its recent case against Google where the jury ruled that Google’s app policy is monopolistic in certain aspects. Which is intriguing, considering a couple years back, the Fortnite maker mostly lost to Apple in a very similar suit. That’s law for ya.

Best Year (Maybe) Ever for Game Releases

In a bout of more positive news, the last 12 months was pound-for-pound one of the top times for game releases. Fans of various genres were not just eating well, but chowing down a lot. Even if, woefully, many people that made them aren’t properly recognized or no longer have jobs. As I’ll cover in later Year-in-Review posts, the quality was consistent and outstanding. Baldur’s Gate 3. The Legend of Zelda: Tears of the Kingdom. Super Mario Bros Wonder. Marvel’s Spider-Man 2. Final Fantasy XVI. Alan Wake 2. Diablo IV. Star Wars: Jedi Survivor. Hogwarts Legacy. Lies of P. Dave the Diver. Hi-Fi Rush. Starfield (love or hate it). Street Fighter 6. Mortal Kombat 1.

Not to mention, 2023 saw multiple indie contenders like Chants of Sennaar, Cocoon, Dredge, Pizza Tower, Tchia and Sea of Stars alongside mobile joints like Monster Hunter Now and Honkai Star Rail. This was supplemented by remakes or reissues of legacy titles like Dead Space, Resident Evil 4 and Metroid Prime. Even one of the highest rated virtual reality experiences ever in Asgard’s Wrath 2. Sure, it also produced stinkers like Redfall, The Lord of the Rings: Gollum, Skull Island: Rise of Kong and the campaign in Call of Duty: Modern Warfare 3. No year is perfect. In aggregate, it’s been mostly a legendary run that stands with the best of them.

Bonus: Embarrassing & Epic Embracer Group Fail

On the flip side, the biggest games industry fail of 2023 goes to Embracer Group and its management, led by Founder and Chief Executive Officer Lars Wingefors. Executives have misguided the bloated Swedish conglomerate, which owns a bunch of operating groups and employed nearly 17 thousand people at its height, making poor decision after poor decision in a frankly shameful display of ineptitude that ultimately affected the lives of thousands of employees.

This started during the pandemic, when Wingefors and crew decided to spend easy cash on scooping up dozens upon dozens of studios and intellectual property rights, expand into tabletop via Asmodee and pursue comics via Dark Horse, attempting to capitalize on volume rather than quality. Once interest rates rose and debt piled up, management tried to secure a deal worth $2 billion with an unknown partner, now reported to be Saudi Arabia’s Savvy Games, which ultimately didn’t happen. This led to a disastrous 2023 of layoffs, project cancellations and business unit closures, with teams like Volition Games closing its doors and Gearbox Entertainment supposedly being shopped around for sale. The pain isn’t over as Embracer’s restructuring will continue into next year and beyond, all as a result of repeatedly bad calls by those at the top.

Sources: CNBC, Company Media & Investor Websites, LinkedIn (Image Credit), Marvin Meyer (Image Credit), NPR (Image Credit), Skadden, TechCrunch.

-Dom

2023 Year-in-Review Megapost is Here

DomsPlaying

That’s all she, and I, wrote. Well, almost. Because 2023 is nearly done.

Which can only mean one thing: It’s time for my prestigious, anticipated, incredible Year-in-Review!

This marks the seventh (!) installment of my annual wrap-up series, where I recap the biggest, best and often bittersweet topics across gaming, technology and media from the last 12 months.

Broadly, across four different categories, I’ll be highlighting a number of topics impacting these industries. From layoffs to labor. Consolidation to unionization. Return to office to hybrid workflows. Artificial intelligence to large language models. Information breaches to antitrust suits. Megalomaniac leaders and Twitter to China and Tik-Tok. Barbenheimer to Mario Bros. Fantastic games to hardware supply.

Scroll below for a rundown of the specific articles you’ll have to look forward to during this year-end time, which runs the gamut from celebration to lamentation. I’ll add links as the posts go up.

Biggest Trends in Gaming, Tech & Media

Five Most Impressive Gaming Companies & The People Who Defined Them

Independent Game Studios of the Year

Dom’s Top 10 Games of the Year

I know I’m partial; I highly recommend bookmarking this post. That makes it super easy to check back often for full coverage of my 2023 Year-in-Review wrap-up!

Thanks so much for visiting and making it a great year here at the site and on social media. Happy Holidays to you and yours. Be safe and well!

-Dom

U.S. Games Industry Sales Decline in November 2023 Circana Report Despite New Best-Selling Call of Duty

DomsPlaying

The year is nearly done. Which means the States are getting chillier, Baldur’s Gate 3 won The Game Awards and this will be the last monthly sales report recap that I’ll write before the calendar turns to January.

Before you know it, I’ll be posting my annual Year-in-Review series. There, I’ll talk about how it’s been an amazing year for game releases yet a very difficult one for working in games. Here, I’m sending all my best to the thousands impacted by layoffs this year and my heartfelt thanks for their work and dedication to their craft.

In terms of the U.S. industry itself, tracking firm Circana recently released its November spending report. It turned out to be a down month as sales declined 7% to $5.87 billion, a lower-than-expected result during the coveted Black Friday month partly due to the console category dropping more than 20%.

This is the second month in a row of spending declines, as October showed a similar dynamic.

The two largest segments, Content and Hardware, both saw lower spending than November last year. Only Accessories experienced growth, and a modest amount at that. Not even ample supply, the PlayStation Portal launch or a brand new Call of Duty could propel towards broader gains last month.

The latest installment Call of Duty: Modern Warfare 3 secured the top spot on the premium software chart during November. This means Activision Blizzard’s military shooter franchise has led its launch month for a staggering 16 years straight. Even so, signs point to a weaker start than its predecessor, and there’s a chance the series will be dethroned in the final 2023 rankings.

“It’s not to say that Modern Warfare 3 is doing poorly (it is already the 2nd best-selling game of 2023 after all),” Circana’s Mat Piscatella told IGN. “But no it is not currently meeting what Modern Warfare 2 did a year ago.”

On the console front, Sony’s PlayStation 5 continued its monthly dominance as it outsold all competitors measured by dollars and units. Similar to its performance in every month this year except for May, when Nintendo Switch led due to a new Zelda, well on its way to securing a win for the full 12 months.

Overall spending across the industry in 2023 still remains ever-so-slightly positive. Earlier monthly gains due to Hogwarts Legacy and The Legend of Zelda: Tears of the Kingdom plus a steady mobile resurgence are carrying weight. It all comes down to December, as this month’s performance will dictate where the year ends up.

Scroll down for a full recap of the figures and my final set of predictions this year.

United States Games Industry Sales (October 29th, 2023 to November 25th, 2023)

Total money spent across all of gaming in November was $5.87 billion, or 7% lower than a year back. The downward movement was attributed to a lack of flagship system launches for both PlayStation and Nintendo, which November 2022 had in God of War Ragnarök, Pokémon Scarlet and Pokémon Violet, alongside generally weaker demand in the console space.

After accounting for this latest result, sales for 2023 are currently trending upwards by 1% to $49.28 billion.

The primary contributing segment of Content dipped 3% in November to $4.6 billion, thus making up 78% of the whole. Compare that to last year’s 75% slice.

“An 11% decline in Console & Portable Content spending was partially offset by 3% growth across each of the Mobile, Subscription, and PC, Cloud & Non-Console VR Content segments,” Piscatella noted.

Mobile is now showing consistent growth, even if it’s in the single digits, a solid reversal of where it was earlier in the year. MONOPOLY GO! repeated as the top monthly earner, followed by Royal Match, Roblox, Candy Crush Saga and Coin Master.

The release slate in premium software has slowed leading into year-end, though there were still four new titles among the Top 20, with two of them among the Top 7.

Call of Duty: Modern Warfare 3 started in that top spot, as it often does. This marks five straight Novembers led by a Call of Duty game, dating back to 2019. After Call of Duty: Black Ops 4 and Red Dead Redemption 2 launched in October 2018, a month won by the former, the latter went on to take November 2018.

October’s leader Marvel’s Spider-Man 2 came in second during its second month, while Hogwarts Legacy bounced back into the Top 3 due to its Nintendo Switch launch as Warner Bros. title in the Harry Potter universe was the second top-selling title on that platform.

Nintendo’s Super Mario Bros. Wonder retained a high position at #5, while the publisher’s newest release Super Mario RPG Remake debuted in 7th. Bandai Namco’s Naruto x Boruto: Ultimate Ninja Storm Connections landed at #12, while Star Ocean: The Second Story R from Square Enix launched at #17.

With respect to Monthly Active Users (MAUs), Fortnite moved up to the most played position on both PlayStation and Xbox ecosystems, surpassing the Call of Duty HQ launcher, while Valve’s Counter-Strike 2 secured Steam’s top engagement. Lethal Company from indie team Zeekerss was the big mover on PC, jumping from 115th in October to 2nd in November.

In terms of the annual list approaching the end of 2023, Hogwarts Legacy is still leading, just above the newly-launched Call of Duty: Modern Warfare 3 at 2nd with less than a month of tracked sales. There are now two Call of Duty titles among the annual ranks, with 2022’s Modern Warfare 2 is #7. The Legend of Zelda: Tears of the Kingdom dropped to 3rd. The biggest mover was Super Mario Bros. Wonder, moving into 15th place after starting October outside the Top 20.

See below for the full list of November top sellers and full-year with only a month to go!

Top-Selling Games of November 2023, U.S., All Platforms (Physical & Digital Dollar Sales):

  1. Call of Duty: Modern Warfare 3
  2. Marvel’s Spider-Man 2
  3. Hogwarts Legacy
  4. Madden NFL 24
  5. Super Mario Bros. Wonder*
  6. EA Sports FC 24
  7. Super Mario RPG Remake*
  8. Mortal Kombat 1
  9. NBA 2K24*
  10. UFC 5
  11. Assassin’s Creed Mirage
  12. Naruto X Boruto: Ultimate Ninja Storm Connections
  13. Sonic Superstars
  14. Star Wars Jedi Survivor
  15. God of War Ragnarök
  16. NHL 24
  17. Star Ocean: The Second Story R
  18. Marvel’s Spider-Man: Miles Morales
  19. Minecraft
  20. Just Dance 2024

Top-Selling Games of 2023 So Far, U.S., All Platforms (Physical & Digital Dollar Sales):

  1. Hogwarts Legacy
  2. Call of Duty: Modern Warfare 3
  3. The Legend of Zelda: Tears of the Kingdom*
  4. Marvel’s Spider-Man 2
  5. Madden NFL 24
  6. Diablo IV
  7. Call of Duty: Modern Warfare 2
  8. Star Wars Jedi Survivor
  9. Mortal Kombat 1
  10. Starfield
  11. Resident Evil 4 Remake
  12. EA Sports FC 24
  13. MLB The Show 23^
  14. Dead Island 2
  15. Super Mario Bros. Wonder
  16. Final Fantasy XVI
  17. Street Fighter 6
  18. FIFA 23
  19. Elden Ring
  20. Remnant II

Hardware ended up being the most surprising part of the whole report, moving down 24% to $964 million, as opposed to over $1.27 billion in November 2022.

This means the segment has now turned negative for 2023, currently down 1% to $4.99 billion.

Declines certainly weren’t isolated to a single platform. Revenue for PlayStation 5, Xbox Series X|S and Nintendo Switch all dropped double-digits last month, with the Nintendo Switch experiencing the most precipitous drop. On units, while Xbox Series X moved up against last November, Xbox Series S sales were lower, thus dragging down that device family.

This result undoubtedly missed my expectations, which weren’t even that upbeat after October. Rather than supply, this is squarely on the demand side as people have already been purchasing the latest generation of devices and weren’t enticed by slight discounting or bundles. Also, buyers didn’t see a must-have exclusive on any platform last month, something that usually drives interest.

“Instead of seeing huge growth because we were comparing to a supply constrained market (like we saw last year), we’re seeing the reverse now,” Piscatella explained. “Where we are comparing to a period of elevated supply and existing demand getting satiated. This comp issue is going to be a challenge in December as well and will finally start settling out in January.”

Sony’s PlayStation 5 again led November, with the most units sold and dollars generated. Xbox Series X|S was the runner-up, while Nintendo Switch slotted in third.

Then there’s a newcomer in PlayStation Portal, a cloud peripheral oddly classified as hardware rather than an accessory even though it requires a console to even function. Well, it debuted in fourth place. Its output wasn’t helped by PlayStation shipping a low supply as anecdotally it’s been selling out at every retailer when there is stock available.

Across all of 2023, PlayStation 5 remains first for the year by units and dollars. Nintendo Switch is currently trending in second place by both as well.

Speaking of Nintendo Switch, Circana shared a quick tidbit. And we love tidbits! It passed the lifetime unit sales of Xbox 360 during November. It’s now behind only Nintendo DS and PlayStation 2 on the all-time domestic list.

Our final segment of Accessories is up next, and it’s the only one that showed growth. Sales here were up 3% to $303 million. Circana shouted out game pads in particular, which moved up 8%.

Intriguingly, this happened without the inclusion of the aforementioned PlayStation Portal. Which means it’s due to mostly existing peripherals and controllers. I’d imagine that instead of putting cash towards consoles, people in the U.S. were more interested in scooping up various accessories for the devices they or their families and friends already own.

Accessory sales are looking up 1% to $2.05 billion if expanding to the full year at present.

November’s best-selling device was Sony’s PlayStation 5 DualSense in midnight black, repeating its win from October.

I assume the PlayStation 5 DualSense Edge game pad remains the year’s top seller, although the report wasn’t specific in this regard. I’ll update this piece if I receive confirmation of this point.

While November was more lackluster than I expected, especially for console sales, spending declines were partly because of a high comparable last year and a softer Call of Duty start compared to its popular predecessor.

After back-to-back negative reports in October and November, there’s a whole lot of pressure on December to secure a fourth quarter to end 2023 on a high note. Personally, I’m not quite sure it’s going to get there, as I’ll now move into a quick set of predictions.

First, December. The big holiday month is upon us. While there’s plenty of enticing games to purchase in a year of incredible releases, I’m thinking overall monthly spend will be effectively flat, driven by a lack of new releases and continued downward pressure in hardware demand.

I think mobile will keep its solid momentum in Content, while a number of familiar faces will appear on the premium sellers list. Ubisoft’s Avatar: Frontiers of Pandora is the only AAA launch this month. I think it will have a Top 7 start, even during the busy holiday blast. Expect Call of Duty: Modern Warfare 3 to repeat as the top seller.

Within Hardware, I’m leaning towards a single-digit revenue decline in December. Microsoft announced a substantial price cut for the Xbox Series X yesterday, dropping it by a hundred bucks for a limited time. Even considering that, I believe PlayStation 5 tops December with Xbox Series X|S next up.

Now, what about the year as a whole? Circana and Piscatella are now weary of their original 3% growth prediction for 2023. Personally, I think a flat December will bring the year to effectively even, with slight upside towards 1% growth. Essentially, due to a declining fourth quarter, consumers will spend about the same amount as 2022.

Hardware is an easy call, as PlayStation 5 will undoubtedly sweep 2023.

The big question is for Content: Will it be the first time since 2008 that a Call of Duty or Rockstar Games title like Grand Theft Auto or Red Dead Redemption doesn’t win?

It’s a distinct possibility, especially with a shaky start for Modern Warfare 3. I’m usually stubborn. This time, similar to my The Game Awards prediction of Baldur’s Gate 3 winning (which happened), I’m updating my expectation. I now think Hogwarts Legacy will be the year’s best premium seller, breaking Activision Blizzard and Rockstar Games streak in a shocking upset.

Thanks for checking out this big recap. I recommend reading through Piscatella’s Twitter thread which has more details on Circana’s latest monthly report.

Check back soon for my annual Year-in-Review series. Happy Holidays to all!

Note: Comparisons are year-over-year unless otherwise noted.

*Digital Sales Not Included

^Xbox & Nintendo Digital Sales Not Included

Sources: Circana, IGN.

-Dom

Spider-Man & Mario Highlight a Down Month for U.S. Games Industry Sales in October 2023 Circana Report

DomsPlaying

Here I am with another domestic sales recap, beginning the final quarter of results for 2023!

October’s numbers are in from industry tracking firm Circana, who revealed the winners of last month’s big battle for supremacy during the year’s busiest time for new game releases.

Despite all the premium software launches, total spending across the U.S. declined 5% in October to just over $4 billion. All of the three major segments of Content, Hardware and Accessories saw lower sales, with Hardware suffering the worst loss over 20%.

That said, 2023’s annual spend remains trending upwards as each category is pointing towards growth rates in the single digits.

The main reason behind October having lower spending, which I apologize for not pointing out last month, was Call of Duty launched last October while this year’s title didn’t hit until November. This led to a strong October 2022, and a difficult comparison against which last month had to contend.

“Growth in physical console software and mobile spending was offset by declines in other areas,” said Circana’s Mat Piscatella. “Particularly digital premium downloads driven by the release date shift of Call of Duty.”

There were still plenty of success stories. October had nine new titles among the Top 20 premium best sellers list, six of which settled within the Top 10. All of them within existing franchises, mind you, as is often the case in a world of brands and sequels.

The biggest among them being Marvel’s Spider-Man 2 which swung a victory as the month’s top earning game, experiencing a notable boost from leading on physical sales in particular. Congrats to everyone who participated in my poll and voted for Sony’s latest blockbuster hit!

It follows that Super Mario Bros. Wonder came in second place, with the usual caveat that Nintendo doesn’t share digital sales here for its published titles.

Supported by the system-seller that is a new Spider-Man game, Sony’s PlayStation 5 again led the Hardware segment. As it has most months this year except for May, trending towards winning 2023 overall in a fully-supplied environment.

Scroll down to get right into October’s data and lists, then my predictions for November.

United States Games Industry Sales (October 1st to October 28th, 2023)

Overall, consumers spent $4.04 billion across gaming in the U.S. during October, or 5% less than last year’s $4.27 billion. This lack of growth, despite all the great starts for software and healthy console dynamics, displays the power of Call of Duty: Modern Warfare 2 launching in last year’s corresponding period. It’s truly a rising tide that lifts all boats.

This latest sales number means 2023 is now tracking up 2%, towards $43.42 billion.

As the largest contributing segment, Video Game Content moved down 4% in October to $3.56 billion. It made up 88% of spending, compared to 86% a year back. Circana attributed it partially to lower downloaded games, even as physical console and mobile gained.

The Content category, which includes software, add-ons and subscriptions, is trending up 1% year-to-date to $37.64 billion.

Mobile was one of the bright spots, a trend we haven’t seen much in 2023. Spending in this area rose 2%, with the report highlighting a consistency among the top games and a notable jump for Clash of Clans back into the Top 10. October’s biggest mobile earners were, in order: MONOPOLY GO!, Royal Match, Roblox, Candy Crush Saga and Pokémon GO.

A variety of new launches bolstered premium software, more than I can remember compared to any month this year.

Marvel’s Spider-Man 2 web-launched above all others during its impressive debut, with launch month sales This year’s Insomniac Games’ open world comic adventure is already the 4th top seller of 2023 even with less than a month of tracking, a monumental win for Sony’s first party that benefited from huge physical sales and a higher price point.

Here’s where Super Mario Bros. Wonder slotted, in 2nd on the overall list and the leader of Nintendo Switch as a platform. It just missed the Top 20 for 2023 to date, at numero 21. Being the first 2D Mario title in over a decade, it’s hard to make legit comparisons for the domestic charts. So I’ll use Switch titles instead. Both Super Mario Odyssey and New Super Mario Bros. U Deluxe reached third during their respective debuts.

Rounding out the Top 3 was Assassin’s Creed Mirage, which continued as a quiet seller echoing recent announcements from Ubisoft on its successful start. Even as a more focused, lower-priced title than its recent predecessors. It began one spot below Assassin’s Creed Valhalla, which debuted in 2nd during November 2020, and the same position as Assassin’s Creed Odyssey in 2018.

Next up for new titles were two annual sports releases in UFC 5 and NHL 24 scoring 7th and 8th, respectively. This means Electronic Arts published four of the Top 8 titles, echoing its live service and ongoing game narrative.

Sega’s Sonic Superstars landed next at #9. For comparison, Sonic Frontiers sped to 4th last November. Beyond the Top 10, Metal Gear Solid: Master Collection Vol. 1 from Konami reached #12, Xbox’s Forza Motorsport reboot finished in 17th and CI Games’ Lords of the Fallen snuck on the list at #20.

You may notice one critical darling that’s missing from October. As I anticipated, Alan Wake 2 didn’t chart. The reasoning is pretty clear. Remedy Entertainment’s latest didn’t have a retail release and publisher Epic Games does not share digital sales. Meaning none of its sales were even counted in this context, thus it’s not comparable to more traditional software starts.

Moving briefly to the annual list right now, the Top 3 remained constant: Hogwarts Legacy, The Legend of Zelda: Tears of the Kingdom and Madden NFL 24. Then there’s the only new entry in Marvel’s Spider-Man 2, knocking Mario Kart 8 out of the Top 20 for the first time all year.

Check below for October’s aggregate premium rankings and 2023 so far.

Top-Selling Games of October 2023, U.S., All Platforms (Physical & Digital Dollar Sales):

  1. Marvel’s Spider-Man 2
  2. Super Mario Bros. Wonder*
  3. Assassin’s Creed Mirage
  4. Madden NFL 24
  5. EA Sports FC 24
  6. Mortal Kombat 1
  7. UFC 5
  8. NHL 24
  9. Sonic Superstars
  10. Hogwarts Legacy
  11. Call of Duty: Modern Warfare 2
  12. Metal Gear Solid: Master Collection Vol. 1
  13. NBA 2K24*
  14. Starfield
  15. Elden Ring
  16. The Crew Motorfest
  17. Forza Motorsport
  18. Star Wars Jedi: Survivor
  19. Minecraft
  20. Lords of the Fallen

Top-Selling Games of 2023 So Far, U.S., All Platforms (Physical & Digital Dollar Sales):

  1. Hogwarts Legacy
  2. The Legend of Zelda: Tears of the Kingdom*
  3. Madden NFL 24
  4. Marvel’s Spider-Man 2
  5. Diablo IV
  6. Call of Duty: Modern Warfare 2
  7. Star Wars Jedi: Survivor
  8. Mortal Kombat 1
  9. Starfield
  10. Resident Evil 4 Remake
  11. MLB: The Show 23^
  12. EA Sports FC 24
  13. Dead Island 2
  14. Final Fantasy XVI
  15. Street Fighter 6
  16. FIFA 23
  17. Elden Ring
  18. Armored Core VI: Fires of Rubicon
  19. Remnant II
  20. Dead Space Remake

Video Game Hardware took the biggest hit of all major segments in October, moving down 23% to $327 million. I don’t see this as a major story, just a move from one month to the next. So many folks picked up new consoles to play Call of Duty in October 2022, with comparable system sales shifting into November this year.

In stark comparison to the monthly figure, Hardware has grown the most through the first ten months of the year, up 6% to $4.03 billion.

The month’s best-selling console again went to PlayStation 5, as measured by both units sold and revenue generated. It’s continuing to track as 2023’s top device by both metrics.

Intriguingly, even during a month in which a new Mario launched, Xbox Series X|S earned 2nd place on dollar sales, while Nintendo Switch was the runner up by units. I’d imagine that’s partially because of a higher selling price for Xbox, and Switch sales are mostly double dips, Mario red OLED versions or purchases for kids as its audience is firmly saturated.

Similar to the movement of their overall category, all of the three big console families saw double-digit spending declines in October.

In addition to the monthly figures, Circana also provided a quick update on where lifetime figures are for the current generation consoles. Which have now been on market for nearly three years! PlayStation 5 is currently 9% above the PlayStation 4, while the Xbox Series X|S family is tracking behind Xbox One by 11%. Makes sense, given the dichotomy between each company’s approach.

Within our final category of Video Game Accessories, spending last month lowered 2% to $147 million. The most modest of declines compared to its counterparts.

Through October, buyers have purchased $1.75 billion worth of Accessories, or 1% higher than the same time frame in 2022.

October’s top earning peripheral was Sony’s PlayStation 5 DualSense in midnight black. I was expecting that the Marvel’s Spider Man 2 Limited Edition controller might win again, as it did in September, though this result is probably more about limited supply than consumer sentiment.

I’ll confirm with Circana on the current annual best seller, which I believe is still the premium tier PlayStation 5 DualSense Edge based on just how much revenue it generates per sale alone.

Now, what about the Meta Quest 3? Didn’t it launch in mid-October?

It did. However, it wouldn’t be included in this particular industry report. Circana confirmed that Meta Quest headset spending isn’t considered gaming for their tracking purposes. Rather, it’s a “a multi-function device.” Which means that Circana’s Technology group reports on Meta Quest.

Compare that to something more streamlined for gaming like PlayStation VR 2, which is included. Even if it remains a somewhat small portion of the pie.

This treatment truly affects the Accessories numbers because Meta Quest has proven to have the most widespread appeal of any augmented or virtual reality device across the consumer space.

Before I recap and shift to predictions, here’s an added bonus: Circana’s new engagement rankings by platform! As part of its public report, the company is now sharing the most played titles across PlayStation, Xbox and Valve Corporation’s Steam digital marketplace for PC titles. Here’s a look at those, in order of Monthly Active Users (MAUs).

During October, Call of Duty: Modern Warfare 2, Fortnite and Marvel’s Spider-Man 2 were the most-played on PlayStation. When it came to Xbox, it’s the same top 2 games then Grand Theft Auto V reached third. Counter-Strike 2, Baldur’s Gate 3 and Cyberpunk 2077 were the most played on Steam. Other standouts included Roblox starting in 4th on PlayStation, Forza Motorsport zooming to 7th on Xbox and The Finals beta landing it in 4th on Steam.

While October’s total spend declined, there’s a clear reason for it and it won’t really impact 2023’s overall result other than shifting spending on Call of Duty to November. Separate of that, which is a purely hypothetical scenario of course, I’d bet October spending would have grown against last year, especially within Content.

On social media, Piscatella mentioned Hardware in particular didn’t have a surprising result, although he believe it was below that which the platform holders expected. He anticipates more discounting and promotion in the coming months. Plus, he’s becoming more cautious on his annual forecast of 3% spending growth in 2023.

Speaking of looking ahead, I’m looking at spending gains in November driven by what I expect to be the biggest seller in Call of Duty: Modern Warfare 3.

Even with lackluster reviews, it’s still the single most popular gaming brand in the country. It will catapult up the annual chart to become 2023’s best seller, maybe even in November’s report. I expect yet another year where two Call of Duty titles end up in the Top 10.

Now that October is behind us, the release slate is slowing down considerably. There’s a couple niche Nintendo titles in WarioWare: Move it! and Super Mario RPG remake, both of which will end up charting, the latter having more upside into possibly the Top 7. Otherwise, I think Sega’s Like a Dragon Gaiden: The Man Who Erased His Name can surprise, reaching a Top 15 start. There’s also Robocop: Rogue City which garnered more critical appeal than anyone ever thought it would. Why not, let’s say it gets a Top 20 start!

It’s a key time for Hardware approaching the November pre-holiday and the Black Friday period here in the States. I expect a comparable dynamic as October where PlayStation 5 will lead on revenue and units, with Xbox in second by dollars and Switch by units. Especially given the new PlayStation 5 model is now on sale, just in time for shopping sprees to begin.

This is where I recommend hopping over to Piscatella’s Twitter thread for further details and a complete rundown of those spankin’ new engagement lists.

I remain eternally thankful you are checking out the site! Stay well as the holiday season approaches.

Note: Comparisons are year-over-year unless otherwise noted.

*Digital Sales Not Included

^Xbox & Nintendo Digital Sales Not Included

Sources: Circana, Nintendo, PlayStation Blog, Sony Interactive Entertainment, Ubisoft Entertainment.

-Dom

PlayStation Hits Its Best Second Quarter Sales Ever as PS5 & Third Party Games Lift Sony’s FY 2023 Q2 Report

DomsPlaying

No rest for the writer!

Today continues an especially busy stretch of this latest earnings season, as Sony Corp just reported its fiscal 2023 second quarter results today out of Japan.

During this three months ending September, both the firm overall and the PlayStation division experienced revenue growth. And while profitability declined at the company level, the amount earned by Sony’s gaming business moved up double digits.

In fact, PlayStation just generated its best ever Q2 revenue in history.

That marks multiple record-breaking quarters in a row for Sony’s Game & Network Services (G&NS) segment, since Q1 hit its own all-time high as I covered a few months back. This past second quarter saw sales zip past $6 billion for the first time, jumping up more than 30% since last year.

Plus, unlike back in June, PlayStation has bounced back to profit growth this time. I’d argue this is even more substantial than record revenue because it accounts for expenses and really gets to the core of its ongoing health amidst a most turbulent of industries.

Underlying momentum was a higher PlayStation 5 contribution alongside better third party and add-on content performance. On the profit side, signs point to the Bungie acquisition costs being fully recognized, since there’s no longer a mention of the deal. Caveat being, similar to Nintendo, we can’t forget about the yen’s weakness on results for these kinds of Japanese companies that have a ton of overseas sales.

One major component is how PlayStation 5 shipped 4.9 million units between July and September, notably more than this time last year and the corresponding quarter for PlayStation 4. This figure was within management’s forecast, pushing lifetime PlayStation 5 sales to 46.6 million and closing the gap with its predecessor when launch-aligned, as I’ll dig into later.

As for the group’s forecast, executives increased guidance for annual gaming revenue across fiscal 2023 while maintaining guidance for operating income and PlayStation 5 hardware shipments at 25 million, which would be the single best year ever for the brand’s console output.

“We recognize selling more than 25 million PlayStation 5 units this fiscal year remains a challenging goal,” said Chief Financial Officer (CFO) Hiroki Totoki when talking to the media. “It will depend on how sales do in the year-end holiday season. We won’t pursue expanding the PlayStation 5 installment base alone, but will keep profitability in mind.”

Scroll down for a swing through the numbers then a set of my own predictions alongside Sony’s future forecasts.

Total revenue for Sony as a whole rose 3% to $19.6 billion, with the biggest growth contribution from G&NS, Sony Pictures and Music, offset by declines in other areas. However, operating profit at the group level declined 24% to $1.82 billion. This was led by quarterly declines for Financial Services, Imaging & Sensing Solutions and Entertainment, Technology & Services segments.

Focusing strictly on PlayStation during the three months ending September, revenue jumped up 32% to $6.6 billion. That’s an entire third of Sony’s overall business. It’s what I call a massive all-time number, considering last year’s $5 billion or so was also a Q2 record at the time.

A crucial note both in the broader context and at the PlayStation level is the specific impact of currency movement. Out of the $1.6 billion growth, upwards of $410 million is strictly because of foreign exchange rate changes. This helps understand how much of the trajectory is organic, compared to an economic market force like yen weakness.

Reversing its fortune compared to a decline in Q1, operating profit for G&NS moved up an impressive 16% to $340 million. That’s 19% of Sony’s group total. Affecting the plus side were both third party content sales and currency movement, plus there’s no longer any mention of certain acquisition costs that were dragging down profitability. I believe the $3.6 billion purchase of Bungie has been fully recognized now and will no longer affect the bottom line. On the downside, management cited how hardware has produced increased losses, I’d imagine due to higher manufacturing costs.

Checking out product category splits, which are shown in the last graph above, Hardware sales grew a whopping 60% since last year and contributed 30% of PlayStation’s total. The next largest segment at 23% of the pie was Add-On Content, moving up 18% in dollar value. Digital Software produced 39% growth, settling at 21% of the total. In fact, the only product type to decline was Physical Software, down a modest 4%.

Annual PlayStation revenue is tracking towards $28 billion. As you can see in the gallery above, on the revenue graph, this is well above the highest it’s ever been, over a billion more than last quarter. Essentially, if this keeps up, Sony’s gaming unit will have its best year of sales ever. On the other hand, annualized operating profit is at $1.75 billion, which compares more to the late days of the PlayStation 4 life cycle. Still great in a historical context, just not as strong as the past three years or so.

As of this week, the “big three” console manufactures have all reported their latest results. The sole remaining biggest player is Tencent, which will be later this month. Right now for comparison purposes, Sony’s $28 billion is tops for the industry. Even if backing out currency impact, it’s well in the lead. Tencent generated $25 billion as of last quarter, and Microsoft’s Xbox segment saw almost $16 billion (though that’s before accounting for anything from Activision Blizzard). Nintendo’s at $13 billion, albeit with more than twice as much annualized operating profit than PlayStation: $4.2 billion compared to $1.75 billion, respectively.

Heads up: enhanced launch-aligned PlayStation console sales chart is live!

This fancy visual aid gives more context to PlayStation 5’s improving shipment numbers. The console’s 4.9 million units sold-in last quarter is an increase of 48% compared to the 3.3 million in Q2 last year. Plus, it’s 26% higher than the PlayStation 4’s 3.9 million in the corresponding second quarter of fiscal 2016.

It’s the fourth quarter since PlayStation 5’s release in November 2020 that it moved more than 4 million units in a quarter, and one of those was that launch period.

Which means that PlayStation 5, at 46.6 million lifetime, has reversed course and narrowed the gap against its predecessor this quarter. It’s presently only a million units away from reaching PlayStation 4, boosting its trajectory since the supply challenges of yesteryear.

This latest lifetime figure means it’s also passed another gaming device on the all-time best-sellers list. That would be Nintendo’s 1980 handheld the Game & Watch, of course, which ended its tenure at 43.4 million. Next up will be Nintendo’s classic Super NES, which sold 49.1 million globally.

One statistic that Sony didn’t update was console sell-thru to consumers. Probably because it usually waits until a big milestone in order to do so. Earlier this year, the PlayStation 5 reached 40 million sold-thru as of July 16th. I’d bet it’s a bit higher now, maybe in the 45 million range, especially ahead of a system-seller like Marvel’s Spider-Man 2. I don’t see a reason demand would have fallen off.

Digging more into the supplemental stats present in PlayStation’s presentation, full game software unit sales stood at 67.6 million in Q2, up from 62.5 million last year. However, due to a lighter calendar, the proportion of first-party published games was lower, making up 7% of that total as opposed to 11% a year back.

Digital versions accounted for 67% of PlayStation game sales, up from 63% in September 2022. This means that 2 out of every 3 premium games purchased for Sony’s platforms were downloadable.

As for player engagement, Monthly Active Users (MAUs) across all of PlayStation Network totaled 107 million as of September month-end. While this is down a million from the June quarter, it’s up 5 million since last year’s Q2. Management also said that total hours played moved up 4% in the latest three months.

Here is where I’ll continue to lament the loss of PlayStation Plus membership numbers, which Sony stopped reporting earlier this year. It will forever, at least for the foreseeable future, remain cemented at 47.4 million as of March 2023.

It’s been a historic run lately for Sony’s top-line gaming numbers, pumping out multiple quarter’s worth of record revenue and generating more than $6 billion in second quarter sales for the first time. PlayStation is the premier industry player by revenue right now, even if backing out the impact from the yen’s depreciation.

Profitability has certainly been more questionable, partially because of temporary factors like studio investments, acquisition expenses and hardware manufacturing costs. Still, it achieved a double-digit income boost in Q2 on hardware units ramp up and software support from external partners like Electronic Arts and Take-Two Interactive with their respective sports titles, plus something like Diablo IV from Blizzard Entertainment and the Warner Brothers Mortal Kombat 1.

Which is why it’s even more painful to hear about layoffs at various PlayStation studios, including Media Molecule, Visual Arts and Bungie. There continues to be a disconnect between executives and everyone else. It’s not just at Sony, this is just one of the more glaring examples especially as its profitability gets back on track.

Impossible as it is to follow that up, I’ll take a look now at the company’s forecast and make some quick predictions.

The firm revised its fiscal year 2024 PlayStation revenue upwards by 5%. Management now thinks gaming sales will surpass $30 billion when the 12 months end in March 2024, in what would be an astonishing finish and record-breaking result. It then reiterated operating profit guidance of $1.87 billion.

In order to hit the 25 million PlayStation 5 hardware unit target, it still needs to ship almost 17 million units across the next two quarters. 16.8 million to be exact. Even with new PlayStation 5 slim models and the PlayStation Portal, this remains a staggering target that will require an absurd holiday number then a miraculous January to March. For context, the largest holiday season ever for PlayStation 4 was 9.7 million in fiscal 2016, and its largest March quarter was 3.1 million right after launch.

Yea, I’m still not a believer. In that overly ambitious forecast or the over-priced peripheral that is the PlayStation Portal. I’ll keep my same prediction as back in August: 24 million to 24.5 million, leaning more towards the lower end.

With respect to software, note that Marvel’s Spider-Man 2 launched after the three months covered here. Still, Sony shared a sales update for Insomniac Games’ latest open world adventure, selling-thru 5 million copies to consumers after 11 days. It had previously started with the best first 24 hours in PlayStation history, at 2.5 million copies. It’s since fallen behind God of War: Ragnarök at 5.1 million in 3 days, nearly a year ago to the day. The Last of Us: Part 2 moved 4 million copies during its opening 3 days back in June 2020.

All in all, it’s a fantastic launch for Peter Parker and Miles Morales considering the size of the PlayStation 5 install base, clearly bolstering the company’s expectations for the back half of this year.

The final bit of relevant news from Sony’s earnings was a comment around its live service strategy, moving into next fiscal year and beyond. As reported by Video Games Chronicle, CFO Hiroki Totoki mentioned that out of its previously-planned 12 live service titles originally scheduled for launch by end of Fiscal 2025, only half of them are on target. Considering how much time and money Sony is putting into this effort, moving them out is a big deal for its financial future and resource allocation. Personally, I remain skeptical that all of them well actually hit market at any point.

Whew. Well, that’s a wild week of coverage coming to a close. I hope you enjoyed this latest recap. Thanks much for hanging around during this season. I’ll have more coverage here and on social media as another eventful year approaches its inevitable end. Take care!

Note: Comparisons are year-over-year unless otherwise noted. Exchange rate is based on reported average conversion: US $1 to ¥144.4.

Sources: Company Investor Relations Websites, Yahoo Finance, Video Games Chronicle.

-Dom