New year, same old calendar. It’s the first earnings season of 2023!
Long-time fans of the site know this is the place for the most comprehensive calendar of earnings dates covering companies across gaming, media and technology. The perfect post for any bookmarks bar.
My calendar’s grown over the years, now boasting over a hundred companies including content publishers, consumer electronic manufactures, software developers, cloud giants, media providers, independent game makers and internet conglomerates. I guarantee there’s something here for everyone.
The latest quarter of results will include sales from the highly-coveted holiday season for those involved in pushing products or attracting eyeballs. In general, it was a challenging quarter across these industries coming off highs of 2021, including a number of record-setting reports. Cost inflation, geopolitical issues and supply disruptions are all still present in the market, among other macroeconomic pressures. This year is off to a tough start for many folks in the tech industry in particular, as layoffs at major firms like Alphabet, Microsoft and Amazon impact talented people whom I hope land on their feet.
In order to track everything, I’ve organized the above image and the below Google Sheets document for easy usage. I’ve also listed out three key companies to watch in the coming weeks within these industries. Thanks for visiting!
When Activision Blizzard reports its fiscal fourth quarter report in February, the big story remains the pending acquisition by Microsoft which has potentially hit snags in key regulatory markets. There’s also the tenuous relationship between management and workers during ongoing unionization efforts, plus workplace condition improvements that executives claim are happening. I don’t expect much in this department, though it would be ideal to hear more about how executives plan to make it a better place to work.
In terms of results, all signs point to Call of Duty: Modern Warfare 2 having a massive holiday, so I expect Activision’s contribution to be sizeable which will boost the overall company on a growth trajectory. On the other hand, I’m bearish on Overwatch 2 and Blizzard’s recent output. Looking ahead, forecasts should be strong as Diablo IV launches in June and there’s still the mysterious language around this year’s “premium” Call of Duty release. Could this be an opportunity to say if it’s a new annualized title or an expansion for the latest game? While I’d welcome it, color me a skeptic.
Embracer Group (EMBRAC B): Thursday, February 16th
During mid-February, when Embracer Group reports its third fiscal financials of 2022, the big question will loom: Are there any companies soon to be embraced by its acquisition touch? All has been quiet lately on the purchasing front for Embracer since snatching up Square Enix assets last year, curious for a company known to gobble up studios big and small to expand its robust portfolio and add to the “quantity over quality” strategy. As of its recent Q2 update, the broader group has 12 operating groups, almost 16 thousand employees, 132 internal studios and a whopping 234 projects in the pipeline. Twenty five of which are supposedly AAA level launches due by March 2026.
Still, partially on lackluster reception of key titles like Saints Row and the recent delay of Dead Island 2 yet again, the company reduced its full-year forecast. Combine that with a major structural change in Volition, the team behind Saints Row, becoming a part of Gearbox Publishing, and I’m curious about the viability of big budget releases for Embracer as opposed to targeting that mid-cost tier like SpongeBob SquarePants and Goat Simulator alongside select re-releases of legacy game properties. Its business is now diversified enough to weather storms, yet I’m still waiting for the sort of organic growth that comes from buying companies over a number of years.
Ubisoft (UBI): Thursday, February 16th
Out of all the big third-party gaming publishers, Ubisoft had a tough go in 2022. Even before its upcoming third quarter earnings announcement, it preemptively shared a gloomy financial update and outlook change just a couple weeks back. In addition to blaming macroeconomic conditions, the same ones its peers are operating under, management pointed to costs associated with cancelling three more unannounced projects on top of four it already killed back in July. Part of the rough patch is under-performance from Mario + Rabbids: Sparks of Hope and Just Dance 2023, the former being the most baffling considering how well Nintendo Switch titles tend to sell.
In what’s turned into a meme, Ubisoft also yet again delayed pirate game Skull & Bones to an undetermined time in “early fiscal 2023 – 2024.” Reports recently point to the company experimented with upwards of a dozen battle royale projects, following its theme of chasing trends instead of setting them. CEO Yves Guillemot and team claim that upcoming releases like Assassin’s Creed Mirage and Avatar: Frontiers of Pandora will bolster the business and help its return to growth, yet I’m skeptical this can actually be a bounce-back year for Ubisoft. I wouldn’t be surprised if it’s been quietly shopping itself around to potential buyers, perhaps garnering interest from Tencent or Amazon, because its model hasn’t been working lately. 2023 is as important a year as ever in the company’s history, and its future as a going concern.
Now that the calendar has turned to January, it’s time to say goodbye to 2022. Which means it’s also time to, yet again, claim that I can accurately predict the future!
As I’ve done in recent years, I tend to kick off the new year by listing out a few predictions for the games industry across the next 12 months. These expectations can range across a number of topics: hardware, software, services, acquisitions, workplace trends and the value of the global games market.
Before diving into the new piece, I like to check back to hold myself accountable for the prior year. Here were my main predictions for 2022, where I successfully called that there would be more unionization, Nintendo wouldn’t announce a new Switch, Sony would rebrand PlayStation Plus and the impact of NFTs and blockchain would be felt in various places.
Misses included the sequel to The Legend of Zelda: Breath of the Wild, now known as Tears of the Kingdom, launching (which it didn’t), the global games market would grow slightly (it declined slightly) and a new BioShock being announced (total long shot, I admit).
Focusing on the future, here’s a list of seven predictions, and a little bonus, for 2023. Let’s see how I fare this time around!
Microsoft & Activision Blizzard Deal Closes in Calendar 4th Quarter
I’ll rip the band-aid off right away. Apologies to everyone who is sick of hearing about Microsoft’s pending purchase of Activision Blizzard: This story isn’t going anywhere anytime soon. Especially now that regulators around the globe have sunk their teeth into the details. Rightfully so, for a deal worth upwards of $69 billion. Currently, the companies still expect the deal to close in June. Personally, I’m skeptical and think it moves back to around an October to December window.
Why? Inquisitive regional regulators in the United Kingdom and United States combined with a glacial legal system. The Competition and Markets Authority (CMA) in the U.K. will publish the results of its investigation in April. The U.S. Federal Trade Commission (FTC) is taking action to potentially block the acquisition, kicking off a legal battle that will commence trial in August. These things alongside delays due to likely appeals if the decisions go against Microsoft mean that I don’t think it meets the current estimate. I do, however, think it ultimately will close before year-end.
Nintendo Goes Another Year Without Announcing a Switch Successor
Continuing my main hardware prediction from a year ago, I’m not betting on Nintendo announcing any major Switch hardware in the upcoming four quarters. One of the best-selling consoles ever is still moving units quite well for this point in the life cycle. It’s trending towards being the top-selling console of 2022 in the United States by units according to The NPD Group as demand continues, especially from households that want multiple devices and a record-setting November start for Pokémon Scarlet & Violet.
While Nintendo reduced its fiscal year shipment target from 21 million to 19 million, plus the technology is certainly outdated, I don’t see much upside in executives revealing a new device in a year where The Legend of Zelda: Tears of the Kingdom and potentially other flagship titles (Mario? Pokémon?) hit market. The transition to a successor will take a delicate touch, notably when it comes to backwards compatibility with the current library of games and usage of accessories. I’m targeting an announcement for what I hope is called Nintendo Super Switch sometime in 2024, with a release in first calendar quarter of 2025.
Global Games Industry Value Returns to Growth & Passes $188 Billion
Last year, I was more optimistic on the global games market value than I should have been when I thought it could increase a bit. According to NewZoo, the industry’s annual value is trending down 4% to $184.4 billion. This is driven by downward pressure from mobile and console segments, declining 6% and 4% respectively. The weakness in mobile is what I didn’t anticipate, and this category has an outsized impact on the overall figure since it makes up half of the total. Then there’s the limited supply of hardware throughout most of 2022, which didn’t really recover until the fourth quarter.
I expect the industry’s worldwide value to bounce back towards growth over the next 12 months. I could see 2% to 3% growth, which would translate to roughly $188 billion to upwards of the $190 billion milestone. Underlying this recovery will be a reversal of trends including a mobile spending rebound, improved hardware inventory, demand for consoles continuing, PlayStation VR 2 and a much more robust AAA software calendar due to previously-delayed games hitting storefronts. Indicators point to strong console demand alongside titles from major publishers, especially Xbox Game Studios, including various holdovers from the past couple years such as Hogwarts Legacy, Star Wars Jedi: Survivor, Street Fighter 6, Final Fantasy XVI, The Legend of Zelda: Tears of the Kingdom and, hopefully, Starfield.
PlayStation 5 Wins Best-Selling Console in the U.S. Yet Misses Sales Targets
While we won’t know until this week’s full-year report from The NPD Group, PlayStation 5 is currently on track to be 2022’s best-selling console in the United States by revenue. GfK Entertainment said Sony’s latest was the top-selling device in the United Kingdom by units. I expect PlayStation 5 to outpace all peers and earn the win for both dollar sales and units in 2023 in key markets (other than Japan, where Switch is dominant). Supply data shows drastic improvement in the fourth quarter of 2022, and Sony’s own comments point towards further growth. Microsoft’s latest Xbox family isn’t generating as much in dollar sales because its high-end Xbox Series X is still tough to find, and Nintendo’s Switch is in its twilight years.
On the flip side, I’m skeptical Sony can reach its fiscal hardware shipment targets for the next couple years. I don’t see how it achieves a highly ambitious forecast of 18 million for the year ending March. At last count back in September, PlayStation 5 lifetime shipments were at 25 million. Sony announced during last week’s Consumer Electronics Show (CES) the PlayStation 5 family passed 30 million sold-through to consumers, implying at least 5 million shipped in the quarter ending December. That would bring the current year to 10.7 million, requiring upwards of 7.3 million during this month through March. Which isn’t going to happen. Going forward, speculation points to an even higher target for April 2023 to March 2024, where executives might guide to 30 million shipped in the year alone. Even if its suppliers are ramping up production as much as Sony claims, and consumers keep showing interest, that’s too lofty of a goal. I’m much closer to a 22 million to 23 million annual range.
Xbox Game Pass Price & Subscription Base Increases
Here’s a classic two-for, combining a couple of big Xbox predictions in a single entry. At first, these may seem at odds with one another since I believe both the monthly cost and overall user base for Xbox Game Pass will increase in 2023. Starting first with the bad news, it’s inevitable that Microsoft bumps the price of its subscription service. The last time Microsoft raised the monthly price of Game Pass was during 2020, when the PC version doubled from $5 to $10. Recently, Microsoft said full-game prices for Xbox Game Studios releases are going up to $70 this year. I’m thinking the Ultimate tier moves to $18, from $15, while the base version moves from $10 to $13 by next holiday season.
Even considering this, I bet the audience of Game Pass also grows in 2023. How many users did the service actually have in 2022? Sony claims it’s at 29 million. Microsoft told everyone it’s at 25 million almost a year ago. While it might be ambitious, I think Team Xbox will provide two updates on its flagship service during 2023. It can pass 30 million by its June fiscal year end, then achieve 35 million by December. There’s a number of benefits boosting the user base towards these milestones. It’s the prospect of first party projects like Starfield and Redfall, maybe a suite of Activision Blizzard titles, plus additional external partnerships especially with Japanese publishers that prove value will continue to rise even if the cost does too.
Special Year of Fighting Game Releases & Announcements
When it comes to genres that may define 2023, I expect fighting games to punch their way back into the spotlight. Relevance here will be boosted by a couple massive launches from legendary teams like Capcom and Bandai Namco alongside newcomers like Riot Games, in addition to select announcements of future titles. Starting with games set to launch, Capcom will produce another mainline entry in its Street Fighter series with Street Fighter 6 in June. Based on anecdotal evidence from its beta testing, people are way upbeat on this one after the disappointing predecessor. Then there’s Tekken 8 from Bandai Namco, which debuted a new trailer at The Game Awards and executives said could launch in 2023. Adding to the calendar might also be Riot Games’ Project L, an exciting twist on the League of Legends universe.
In terms of announcements and reveals, SNK said in August that Garou: Mark of the Wolves 2 is currently in development. Of course, the elephant in the room is Warner Bros’ NetherRealm, which hasn’t released a game since Mortal Kombat 11 back in 2019. If it sticks to the usual schedule, its current project should be Injustice 3. Back in October, NetherRealm’s Ed Boon said the team will share information “in due time.” I expect that time to be mid-year. Finally, I’m anticipating a surprise fighting game hit within the casual space, along the lines of last year’s MultiVersus. Could it be the return of PlayStation All Stars Battle Royale? Will Epic Games partner with every single brand and make the ultimate metaverse fighter? Which title will be the next to surprise the FGC and solidify 2023 as the Year of the Fighting Game? Your guess is as good as mine, though I certainly expect at least one breakout banger.
Amazon Games Makes Massive Studio Acquisition
First off, I have no real basis for this. There haven’t been rumors or speculation. It’s not based on inside information. It’s more of a hunch with the way Amazon Games has been aggressively pushing into the space, especially the past couple years with releases like New World and Lost Ark alongside a deal with Glowmade for a game based on original IP. It’s collaborating with the likes of Bandai Namco on the MMORPG Blue Protocol plus Crystal Dynamics for a future entry in the long-running Tomb Raider series. It partnered with Riot Games to host a Valorant event. The multinational retail conglomerate also owns streaming platform Twitch, and its Prime Gaming service continues to offer incentives for gamers to keep up Amazon Prime subscriptions.
I think Amazon’s level of investment accelerates in the next 12 months, during which it might even outright purchase one of the remaining independent gaming companies. Targets could include the likes of Electronic Arts, Square Enix, Take-Two Interactive or even Ubisoft, the last of which already has an acting relationship for streaming service Amazon Luna. If I had to bet, I think Ubisoft is a prime candidate. From a cost perspective, it’s more attractive than the likes of Electronic Arts. Square Enix has been selling off assets and refocusing towards NFTs. Take-Two seems to pride itself on remaining independent with its 2K Games and Rockstar units. It sounds like Ubisoft has fielded offers in the recent past, so Amazon might very well be looking into a potential buy already.
You know I couldn’t finish the list without a fun bonus prediction! I think there’s a really good chance that we see what non-gaming projects Bungie has been working on within the Destiny universe. It’s no secret the developer is ramping up hiring for its transmedia offerings, including adding former Riot Games animation director Derick Tsai to become Head of Development for Destiny Universe Transmedia. Plus, now that Bungie is owned by Sony, I’d imagine there’s active chatter amongst Sony’s film and television divisions to adapt Bungie’s popular science fiction IP into different types of media.
To make this prediction better, I bet Bungie both reveals and launches a transmedia property based on Destiny in 2023, whether it’s a movie or show. The game has rich lore and great characters which I think could translate well into an episodic format. Similar to how the live game does seasonal content and weekly story drops. I’d love to see its world represented outside of gaming, exposing the excellence that is Destiny to an even broader audience than ever before.
Note: Comparisons are year-over-year and monetary values are quoted in US Dollars unless otherwise mentioned.
Sources: Foureyes Furniture on YouTube (Image Credit), Getty Images, GfK Entertainment, NewZoo, The NPD Group.
Before I mentally move into 2023, there’s one last thing for me to do. Write about my favorite games, and rank them for fun!
In my last post of the year and time to run down the best of what turned out to be a busy 12 months across the spectrum of games, even if the AAA calendar was more sparse than usual. Don’t let anyone tell you that the industry had an off year. Mid-tier and indie devs picked up the slack, and launched several memorable experiences. Plus, PlayStation Studios had a great run.
This is probably the most diverse, experimental list in the seven (!) years I’ve been posting them here. There’s everything from sprawling open words, heartfelt mythological journeys, spooky point-and-click titles, immersive full motion video interactions and gorgeous, cutesy adventures. Almost all platforms are represented, from mobile and web to traditional consoles.
For context, I played roughly 50 games in 2022. Check below for which ones made my prestigious Top 10, then a set of five amazing honorable mentions. Toast your glasses to gaming!
Dom’s Top 10 Games of the Year 2022
10. Tinykin (Splashteam Devs, tinyBuild)
Platforms: PlayStation, Xbox, Nintendo Switch, PC.
Admittedly I didn’t have Tinykin on my radar coming into the year, and boy am I glad I played this 3D platformer with its distinct visual styling, smart progression elements and cute creature collecting. Splashteam crafted a beautiful, realized setting and knocked the character dialogue out of the park.
9. Card Shark (Nerial, Devolver Digital)
Platforms: Nintendo Switch, PC.
I have a feeling the historical “cheating simulator” Card Shark won’t be on many year-end lists, which is quite disappointing considering how excellent its artwork, mechanics and writing proved to be. Shuffle those in with a great tutorial system and an on-the-run story with plenty of twists and turns, and developer Nerial loaded up the deck with plenty of aces here.
8. Citizen Sleeper (Jump Over the Age, Fellow Traveller)
Platforms: Xbox, Nintendo Switch, PC.
Dabbling in everything from consciousness and artificial intelligence to capitalism and community, Citizen Sleeper expertly captures the desolation of existing within a scary society and navigating one’s course with limited resources. Its introduction of randomness via dice rolls eerily echoes the crapshoot that is life, and the game’s constant ticking clocks combined with fragile relationships make its decisions as affecting as any across gaming in 2022.
7. Wordle (Josh Wardle)
Platforms: Web Browser.
The internet set ablaze in January when Wordle skyrocketed in popularity, filling up social media feeds everywhere with intriguing blocks and competitive spirit. Considering I’m still playing Josh Wardle’s wonderful love-letter to his partner Palak Shah all these months later reinforces the brilliance of its “one chance per day” setup, a clever way to express how every single choice counts when trying for consistency in one’s ongoing existence.
6. A Plague Tale: Requiem (Asobo Studio, Focus Entertainment)
Platforms: PlayStation, Xbox, Nintendo Switch, PC.
The sequel to 2019’s masterpiece A Plague Tale: Innocence intensifies the plight of brother and sister Hugo and Amicia, pushing its stealth gameplay into new avenues and continuing the stellar narrative navigation throughout the dark times of 14th century France. It’s a technical showpiece, shoving thousands of rats and heaps of prowling guards into most levels, plus shows what perfect pacing can do for the arc of adventure, culminating in a teary, shocking conclusion.
5. High on Life (Squanch Games)
Platforms: Xbox, PC.
Justin Roiland and Squanch Games snuck High on Life in during December, wrapping up 2022 with the industry’s most ludicrous, hilarious release. The first-person shooter-comedy redefines the medium’s boundaries, featuring a suite of talking weapons played by incredible actors, nifty platforming, chunky mechanics, vulgar writing and even a few in-game movies, resulting in one of Xbox’s most eccentric, exceptional and popular titles of the year.
4. Immortality (Half Mermaid, Netflix)
Platforms: Xbox, PC, Android, iOS.
Sam Barlow and Half Mermaid’s entries into the interactive gaming space ingeniously utilize full motion video and awesome acting to tell stories that most games can’t, and Immortality is the team’s magnum opus. It’s a set of film clips and behind-the-scenes glimpses that present as one thing then quickly turn into something extraordinary, peeling back layers as it progresses, to the point where it’s difficult to talk about why it works so well without completely spoiling the story. Suffice to say this master class of design firmly lands among my favorites of 2022.
3. Norco (Geography of Robots, Raw Fury)
Platforms: PlayStation, Xbox, PC.
Starting off my Top 3 is Norco, an adventure set in a supernatural, Southern techno-industrial town that starts as a daughter’s return to her hometown and blossoms into a thrilling search for family, faith, religion and closure. It’s hard to pin down this bizarre game mainly because it’s so unique, always moving in unexpected ways while including robot helpers and cultlike societies, shady characters and folklore galore. Navigation is easy across its user interface, a stark contrast to figuring out where it’s going, and the player can land on a variety of endings depending on how they choose to steer the plot, all of it transformative and downright miraculous.
2. God of War Ragnarök (Santa Monica Studio, Sony Interactive Entertainment)
Platforms: PlayStation.
I’m not sure God of War Ragnarök tops its 2018 predecessor, which totally revamped the series, however its story progression, character movement, mechanical prowess and area design made it come darn near close. It’s a rich take on Norse mythology and the introduction of new characters, notably Richard Schiff’s depiction of Odin, force plenty of rivalries and team-ups that serve as the underpinnings for a sweeping arc.
Its open zone approach entices exploration while it pulls on heartstrings and allows a new perspective other than Kratos by occasionally swapping to control of his now teenage son Atreus, a clever dichotomy that fits mechanically and narratively. Not to mention the art direction and scenery design mesh with solid performance to showcase the PlayStation 5’s power, resulting in a fitting conclusion to this latest God of War saga while simultaneously opening doors to future epics.
1. Elden Ring (FromSoftware, Bandai Namco Entertainment)
Platforms: PlayStation, Xbox, PC.
If you’ve followed me on social media at any point since Elden Ring launched back in February, its position as the year’s best comes as no surprise. FromSoftware has been building to this masterpiece for years, successfully delivering the ideal of traditional soulslike action role-playing within an spacious, ominous open world that boasts some of gaming’s most spectacular art design and general vibes to date. The Lands Between is one of the most realized, enchanting settings ever, providing the backdrop for the player’s rise as Tarnished in this foreign kingdom.
What makes Elden Ring stand out from everything that’s come before is how it’s simultaneously more accessible and just as rewarding as any challenging game in FromSoftware’s portfolio. The introduction of a fast travel system, offering of a speedy mount in Torrent and a plethora of summons available, both non-playable character and human alike, mean there’s rarely a place where players bump up against something that halts progression. That doesn’t mean there aren’t tricky encounters, there’s plenty, it’s just that the team provides more tools to deal with them or take a break when something isn’t going well.
Then it produces an incredible feeling that around every corner, there’s something worthwhile to find. My two favorite parts of Elden Ring both revolved around moments where possibilities seemed endless, and were equally as jaw-dropping. First was stepping into its second main area of Liurnia, overlooking a shallow lake in the middle with a magic academy to my right and rolling hills to my left. I knew the next dozen or so hours would take me to every nook and cranny. Then there’s the famous descent into Siofra River, a seemingly endless elevator ride deep into an underground expanse full of supernatural specters under a ceiling of stars.
These kinds of awe-inspiring moments captured the essence and potential of Elden Ring, a game so massive that I couldn’t believe just how much was on its map. This doesn’t even get into it’s underlying lore, cast of characters, expansive world-building and narrative that forms the ultimate fate of The Lands Between. My time with Elden Ring was the most special I had all year, and it’s one of the single best games I’ve played in my life. It’s beyond worthy of 2022’s Game of the Year.
Honorable Mentions
As Dusk Falls (INTERIOR/NIGHT, Xbox Game Studios)
Platforms: Xbox, PC.
Dying Light 2: Stay Human (Techland)
Platforms: PlayStation, Xbox, Nintendo Switch, PC.
Horizon Forbidden West (Guerilla Games, Sony Interaction Entertainment)
Platforms: PlayStation.
Kirby and the Forgotten Land (Nintendo)
Platforms: Nintendo Switch.
Marvel Snap (Second Dinner, Nuverse)
Platforms: PC, Android, iOS.
There we have it. What a list!
And with that, 2022 Year-in-Review here at Working Casual comes to a bittersweet end. Thanks to everyone for making it another awesome year at the site and on social media. Switch back over to the megapost for all things year-end.
It’s time for arguably my favorite article of the year!
As part of my year-end recap series, here I’ll be celebrating smaller teams and indie developers across the games industry. These folks, whether a tight-knit studio or one-person team, filled out an incredible annual calendar of indie experiences during 2022.
Their excellent games ranged from adventures to live action, from puzzle to speed-running and various types in between. Many will stick with me for years to come, and some will definitely occupy a space on my favorite titles of the year.
No reason to wait any longer. I know the suspense is palpable! In alphabetical order, here are the lucky 13 best indie studios of 2022.
Andrew Shouldice
The first entry is mostly a one-man developer in Andrew Shouldice. The Canadian’s story in development begins at Silverback Productions for a few years then shifts to full time work on the highly ambitious project in Tunic, a Zelda-inspired adventure game. The top-down title launched in March after many years of work from Shouldice and a small team of collaborators, an exquisite blend of colorful artwork, tricky combat, puzzle execution and an ingenious in-game manual that communicates mechanics via visual hints. It’s the culmination of many stressful sessions and years of hard work from Shouldice, thus easily earning a spot on this list.
Angel Matrix
Headlined by Ben Esposito, of Donut County fame, Angel Matrix is a collective of people across many disciplines that launched its first game Neon White this past year. The fast-paced, first-person speed runner is a sensory onslaught, blending expert platforming, slick shooting and a sick soundtrack from Machine Girl to result in something resembling nothing else I played in 2022. Throughout its release month of June, gamers everywhere fought for leader board positioning and chatted with heavenly assassins in a one-of-a-kind world built by Angel Matrix.
BlueTwelve Studio
Within the south of France, BlueTwelve Studio developed “the cat game” Stray, an indie darling and Best Debut Indie Game winner at The Game Awards. The PlayStation console exclusive is the premier kitty experience across all of gaming, a third-person adventure where the player unravels riddles within an underground city of robots. In typical feline fashion, there’s the ability to climb, claw, creep and snuggle up for a quick snooze, and all the while BlueTwelve tells a tight narrative via context clues and environmental puzzles. It’s hard to see meow the team can top Stray, one of 2022’s pawsitively delightful mysteries.
Geography of Robots
Mainly comprised of five members named Yuts, Aaron Gray, Jesse Jacobi, fmAura and Gewgawly I, the team at Geography of Robots launched one of 2022’s most unique stories in Norco back in March. It’s an exceptional, inventive point-and-click narrative that’s based around choice within a supernatural Southern setting, originating from a multimedia project all the way back in 2015. It’s biographical for Yuts, who grew up in the titular Norco, Louisiana, and the team’s years of development paid off as the title won Tribeca Film Festival’s inaugural gaming award back in 2021. Not to mention it’s the reason why the studio is on this list as well. And rightfully so.
Half Mermaid
Highly-decorated indie designer Sam Barlow (Her Story) is known for moving past the medium’s traditional setup, leveraging full motion video and experimenting with user interfaces. He organized Half Mermaid in 2017, and after Telling Lies in 2019, they started on what is undoubtedly a modern masterpiece in Immortality. This smashing showpiece of interactive storytelling blurs the line between media, existing somewhere among avant-garde films and point-and-click games, telling a multi-layered tale of an actress across three of her unreleased movies. Half Mermaid nails its mission of using a “spectrum of narrative genres” to tell its stunning stories, and continues to showcase what gaming can be when it’s at its most original.
INTERIOR/NIGHT
The London-based studio INTERIOR/NIGHT formed in 2017 as it’s managed by former Quantic Dream lead Caroline Marchal and features a diverse set of industry vets. Their goal is similar to the prior entry, mixing an episodic television approach with interactivity. During July, the team launched its debut title As Dusk Falls which is known for a stark, stop-motion art style and a myriad of difficult choices that push characters in different directions depending on the playthru. Its multiplayer mode is exceedingly novel, allowing up to 8 players to vote on outcomes and guide the overall movement. Reminiscent of projects from LucasArts and Telltale, INTERIOR-NIGHT’s first effort is among the best decision-driven stories of 2022.
Josh Wardle
For those online during the first couple months of 2022, the yellow and green boxes of Josh Wardle’s Wordle were inescapable. In the best way possible. The elegantly-simple digital sensation of a word game has an incredibly sweet story behind it. Wardle started it up as a fun way to pass the time with his partner Palak Shah, who also played a pivotal role in the game’s early development. Accessed solely on a web browser, Wordle’s “one puzzle a day” is the crutch of its genius, providing an avenue for folks to compete then come back to continue their streak. Its beautiful backstory culminated in The New York Times purchasing it for over a million bucks, solidifying Wordle in the pantheon of internet history forever.
Jump Over the Age
Here’s another solo developer that excelled in 2022. Gareth Damian Martin, who has done everything from designing games to critical writing and running a zine to lecturing on the academic circuit, is behind Jump Over the Age. They produced their second title in Citizen Sleeper in May, challenging thoughts around the coldness of capitalism, the weight of debt and challenge of community. It’s a creative, story-based achievement set on a spooky, desolate space colony that introduces randomness, as life itself often does, via dice rolls and light survival mechanics. Featuring excellent character art and promising prose, Gareth’s inquisitive, insightful indie should be a sleeper pick for plenty of year-end lists.
Massive Monster
Cult of the Lamb is the biggest release to date for Massive Monster, a small studio spanning Australia and the United Kingdom that started back in 2016 in the aftermath of the flash game era. The title is a true hybrid, combining bespoke concepts into a singular experience: Community simulator meets dungeon-crawler. Juicy dark humor and devilish decisions parallel the snappy, satisfying mechanics of diving into dungeons and smashing enemies in Massive Monster’s latest, which isn’t tied down by traditional genre convetions. Roguelike elements and time management intersperse in Cult of the Lamb, a standout gem of a game, forcing choices with weight as the player evolves into a benevolent leader or nefarious commander.
Nerial
Listing around a dozen people on its website, Nerial is the studio behind Card Shark, the single most underrated indie triumph of 2022. Based out of the United Kingdom, the team made Reigns titles prior to launching 2020’s Orwell’s Animal Farm. This past year brought about what I think is its magnum opus in Card Shark. Many more people should be talking about Nerial’s tour de force, with its high quality 18th century French artwork and nifty puzzles that center around cheating at parlor games to snatch winnings from pompous rich folks and historical figures alike. The best part is its tangible mechanics, capturing the feel of shuffling cards or peeking at an opponent’s hand. There’s also an underlying story that deals with deceit and cunning, a truly complete package of delectable deception.
Poncle
What started as a pet project for Luca “Poncle” Galante turned into one of the hottest, most highly-praised indie darlings of 2022 in Vampire Survivors. For good reason. Beginning the year in early access then pushing towards full release in October, Poncle’s project is severely addictive with its old school trappings, catchy music and singular premise: stay alive. The simplicity of control is reminiscent of an idle game, where players determine movement with a joystick while picking upgrades when leveling up. There’s much more to Vampire Survivors than it initially presents, unraveling progression as a player’s expertise grows. Poncle has found a perfect niche, a modern-day arcade accomplishment, which has a gameplay hook and “one more play” potential like none other in recent memory.
Splashteam Devs
As one of the year’s sneaky good indies, Tinykin is a delightful platform adventure with Pikmin-esque creature collecting, superb world feel and exemplary puzzle design. The team behind this amazing amalgamation is Splashteam, a close crew including former Ubisoft employees that worked on Rayman and Rabbids franchises. Launched in August, Tinykin is their second game after 2017’s Splasher and it’s an immaculate foray into 3D platforming, featuring cute animations, referential writing and flawless pacing. Additional stand outs are its setting and characters, led by astronaut Milo who meets various communities of tiny critters within a mysterious, massive house. The payoff is great as one of 2022’s top indies really scratches the eternal itch of exploration and collection.
Squanch Games
It’s incredibly difficult to be genuinely funny, especially in games because of the added challenge of player interactivity. Leave it to Justin Roiland (Rick & Morty) and the team at Squanch Games to accomplish this feat, often pushing the limit of absurdest humor and wacky characters in prior games like Trover Saves the Universe and Accounting+. Their most recent release High on Life is one of 2022’s best. It’s Squanch Games at its biggest, boldest and raunchiest. Writers and artists run wild with a ridiculous alien adventure that mostly lands, adapting solid metroidvania components and a colorful graphical palette into a twisted tale of interplanetary drug cartels and humanity’s last hope. It’s as much an interactive comedy as first-person shooter, pumping the player full of laughs as a late year Game of the Year contender.
It’s a longer list than usual because of just how many excellent indie projects released in 2022. Which indies stood out to you? What do you think of the list?
Thanks for making it this far in my celebration of the best indie studios over the past 12 months. Navigate back to my 2022 Year-in-Review megapost for more!
Sources: Media Sites, The Signal (Image Credit), The Times (Image Credit).
On this Final Friday of 2022, I’ll recap the most impressive and relevant companies across the games industry.
This will cover larger companies, whether they are publicly-traded, subsidiaries or owned independently. (My next article will delve into the year’s premier indie studios and smaller development squads.)
It’s mainly meant as a celebration to the thousands of talented folks that work at these places and make the industry what it is. While 2022 wasn’t as busy on the release calendar at the AAA and mid-tier level, there were plenty of stand-outs that launched games or revealed upcoming projects.
Without further ado, from hardware manufacturers to software developers, here they are in alphabetical order!
FromSoftware Inc
First up is really the easiest pick of the bunch. Over the past decade, FromSoftware has established itself as the premier studio for crafting challenging role-playing experiences with incredible art direction, creepy vibes and fantastic lore. The Japanese developer, spearheaded by mastermind designer Hidetaka Miyazaki, has effectively created a genre with its Dark Souls series and boasts modern classics like Bloodborne and Sekiro: Shadows Die Twice.
Launching in February 2022, its latest masterpiece Elden Ring sprung the soulslike from a gaming genre to cultural touchstone. The open-world approach transformed the traditional model into something special, dominating social media for months and earning it Game of the Year honors at The Game Awards among other outlets. The game’s setting, The Lands Between, has become a legendary stomping ground for long-time fans and new players alike. Elden Ring sold a staggering 12 million copies in less than a month, the team’s fastest-selling title ever across its 35+ year history. It’s well on its way past 17 million and could pass the 20 million milestone in the new year.
Speaking of 2023, FromSoftware plans to return to one of its beloved, dormant franchises in Armored Core after revealing Armored Core VI: Rubicon of Fire earlier this month. There’s also rumblings of a potential Elden Ring expansion upcoming. Based on the way its history has shaped up, and how incredible 2022 was for the studio, it will undoubtedly continue to set standards of game design moving into the future.
Marvel Games
The folks behind Marvel Entertainment, one of the world’s biggest media houses, have made a concerted effort to expand more into the games industry during recent years. Especially more mainline, premium releases. From the likes of Marvel’s: Spider-Man in 2018 to 2020’s Marvel’s Avengers, Marvel Games has shown a dedication to fitting studios with the right properties to produce titles on both traditional and mobile platforms. This effort ramped up in the last few months, boasting critical successes and generating optimism around future announcements.
There was no more important launch in perhaps the company’s history than Marvel Snap, the mobile deck-building phenomenon that hit market in October. Its ingenious mechanical simplicity, exceptional card artwork and non-invasive monetization appealed to casual and core fans, even those without close ties to the cinematic universe. During its first month, Marvel Snap secured $10 million in revenue on 12 million downloads and earned Best Mobile Game at The Game Awards.
The team coordinated additional launches in the back half of 2022. This included Marvel’s Spider-Man: Miles Morales on PC in November and December’s Marvel’s Midnight Suns, a blend of tactical gameplay, card mechanics and relationship-building which catapulted it to overwhelming critical praise. Marvel Games also revealed upcoming projects alongside Skydance Media and Amy Hennig for a mysterious Black Panther/Captain America team-up, plus a collaboration with Motive Studios on an Iron Man action-adventure title. It’s reassuring to see the direction of Marvel Games and its clever licensing deals, which have and will continue to pay big dividends.
Raven Software
I briefly wrote about the next company on my list during my biggest trends of 2022 article, where I recapped the industry’s recent unionization efforts. Raven Software, a subsidiary of Activision Blizzard based out of Wisconsin, saw certain employees lead the charge for workers’ rights in 2022 while simultaneously coordinating the follow-up to Call of Duty’s massively popular Warzone mode. Both of these accomplishments firmly land it among the year’s most exceptional, and impactful, triple-A studios.
Back in late 2021, Quality Assurance (QA) team members at Raven Software organized a strike after fellow teammates were fired. During January, these folks formed the Game Workers Alliance (GWA) in order to get a seat at the table in company dealings. Demands of the GWA included better timeline management, less crunch and more opportunities for underrepresented groups. In a historic May vote, an overwhelming majority of GWA members voted to unionize and were subsequently recognized by the National Labor Relations Board (NLRB). This marked the second successful union in North America and the first at a major American games publisher.
Alongside all of this, Raven Software coordinated a massive revamping of Call of Duty’s free-to-play Warzone 2.0, one of console and PC gaming’s most popular battle royales. The team shipped the new mode on November 16th. Raven Software’s importance in the AAA space can’t be understated, and the icing on the cake is that Microsoft’s Head of Gaming Phil Spencer said the company would recognize the union if its $69 billion purchase of Activision Blizzard takes place. In the broader workers’ rights push across games, Raven’s brave and committed QA workers were at the forefront.
PlayStation Studios
The most prolific first-party in gaming had another stellar year in 2022, shipping several major titles, pushing towards accessibility and securing multiple acquisitions that will bolster output for decades to come. PlayStation Studios, a worldwide conglomerate of Sony’s premier development teams, was responsible for new launches in a variety of franchises, including at least a couple Game of the Year contenders. Without the incredible effort of its employees, the year’s release calendar would have been barren.
To show the sheer level of output in 2022, here’s a list of the new titles moved by its various teams: Horizon Forbidden West, MLB The Show 22, Gran Turismo 7 and God of War: Ragnarok. Then there’s reissues or ports like The Last of Us Part 1 (even if more remaster than remake), Uncharted: Legacy of Thieves Collection and Marvel’s Spider-Man: Miles Morales on PC. The likes of Santa Monica Studio and Guerilla Games created the year’s most epic experiences, showcasing amazing graphics, narrative prowess and animation chops. As the unsung hero, Sony San Diego’s annual MLB The Show baseball games are as consistent as they come. Gran Turismo 7 from Polyphony Digital was praised by critics as one of this generation’s best racing sims.
Not only that, Sony’s talented teams focused more on accessibility and inclusivity, an important movement that allows more gamers to enjoy PlayStation titles. Then there’s acquisitions that finalized in 2022 like Bungie and Savage Game Studios. The former is a significant piece of Sony’s goal to move into live services while the latter will bolster its newly-formed mobile division. PlayStation Studios is the reason to own a PlayStation 5, and its team members lived up to exceedingly high standards yet again.
Valve Corporation
Intriguingly, the reason I’ve concluded this list with Valve is not because of its industry-leading Steam platform. I will say the digital distribution continues to be the best place to own, organize and play PC titles, even as competitors like Epic Games push more into that segment of the market. Steam attracts a massive population of gamers, passing a major milestone this year in 30 million concurrent users during a weekend in October. This figure was roughly 27 million in late 2021, illustrating its illustrious appeal over the past 12 months.
The reason is simple: The Steam Deck. Until now, Valve had a tricky history with hardware. From Steam Machines to Steam Link, its devices garnered mixed reviews and minimal usage. It wasn’t until this February that Valve nailed a hardware design that truly revolutionized hardcore gaming. The Steam Deck handheld is Valve’s single best manufactured product to date, and the greatest hardware triumph of 2022. It’s flexible, easy to use and way more comfortable than it has any right to be. It allows access to one’s Steam Library, showcases a myriad of “Deck Verified” games plus can be used to access services like Xbox’s cloud offering. What I love the most is how the company actively supports people tinkering with it. It’s effectively a Linux-based PC in the palm of one’s hand, and I think the ideal place to play indies.
Even as a first iteration, it’s an essential part of how many people played this past year. Sure, there are drawbacks. Battery life isn’t great. Its price isn’t as attractive as something like Nintendo’s Switch. It can’t play my beloved Destiny natively (though that’s more on Bungie than Valve, I’d say). Still, signs point to 1 million units shipped in its first six months, which is a solid sales result considering how slowly it shipped. The Steam Deck is a more niche, premium product that single-handedly advanced the industry, and was by far my favorite piece of tech this year.
Thus concludes the awards for 2022’s most impressive gaming companies. Congrats to everyone that worked hard at these firms to produce some of gaming’s most memorable experiences and products. And thanks all for reading! Check back to the 2022 Year-in-Review megapost for all my year-end articles.
Sources: Company Investor & Media Sites, Game Workers Alliance, GamingonLinux, MobileGamer.Biz, Steam DB.
In the first article of my year-end series, I’ll run through the biggest trends impacting gaming, media and technology during 2022.
It was a curious time of both disruption and normalization. For the former, there was Russia’s invasion of Ukraine. Countries grappled with lingering effects of coronavirus. Inflationary pressure combined with economic slowdowns across various regions. Billionaires and executives alike threw around money to scoop up companies. Gaming publishers delayed titles and shifted their release calendars.
As for the latter, companies everywhere settled into a “new normal” of hybrid working. Inflation started to cool in recent months. Consumer electronic manufacturers shored up supply chains, and began producing more inventories. Notably within gaming hardware. Consumers shifted back towards forms of entertainment outside their homes.
Way back in January, I predicted some of these would happen. Though certainly not all of them! That said, now that we’ve experienced it, here’s a list of major stories that fundamentally changed these sectors during 2022. Here’s hoping this article trends towards keeping your interest!
Games Industry WorkersIncreased Unionization Efforts
This is one of my predictions that I’m happy came true. Employees fighting for their rights, notably those that work in gaming, ramped up substantially in the last 12 months. In January, Quality Assurance (QA) workers at Activision Blizzard’s Raven Software started up the Game Workers Alliance (GWA). Then in May, that team became the first union ever to form at a gaming publisher in the United States. Later, Vodeo Games was the first entire gaming studio in North America to unionize when it voted in September.
More recently, earlier this month Microsoft executives said they would recognize a union being formed by roughly 300 employees of ZeniMax Studios. This in particular is a significant move towards worker rights, as the Communication Workers of America (CWA) celebrated Microsoft’s willingness to recognize and not force a protracted legal battle. Seeing a company as massive and influential as Microsoft to make this decision showed how 2022 was a significant year for unions and workers’ rights in the games industry, and I fully expect this trend to accelerate into 2023.
Social Media, Elon Musk’s Twitter & TikTok’s Expansion
I’m lumping in a couple topics here that dominated the social media landscape this past year. It’s hard to avoid hearing from billionaire weirdo and apartheid apologist Elon Musk, especially when he single-handedly upended the space with his October purchase of Twitter for $44 billion. What followed in the coming weeks was a simultaneous mass exodus from the firm and Musk touting how the platform saw record engagement. Thankfully he claims he’ll be stepping down as Chief Executive Officer soon, because a poll of Twitter uses told him to do so, though the damage has been done for many that moved towards the likes of alternatives in Hive Social or Mastodon.
Elsewhere, in the video streaming world, TikTok’s popularity skyrocketed in 2022 after gaining traction during quarantine times. It began the year with over 1 billion monthly active users (MAUs). Statista estimates it will end the year at upwards of 1.7 billion MAUs, and will likely pass 2 billion in 2023. It’s been downloaded over 3.5 billion times, only the 5th platform ever to accomplish this figure and the first on that list to not be owned by Facebook parent Meta Platforms. The short-form video content platformer has become a premier destination, both for creators and fans, and often dictates trends or news stories especially among its younger users.
Evolution of Working: Remote, Hybrid & Four-Day Work Weeks
Even if certain leaders (see the aforementioned Musk) insist on forcing people back into the office, plenty of big companies settled into a hybrid working compromise in 2022. Apple, Google, Microsoft, Amazon and Meta have all embraced some form of a hybrid working model. Almost 90% of European companies surveyed by Owl Labs planned to offer hybrid solutions post-pandemic. On the upside, it’s a much more flexible environment for workers and often acts as a welcoming culture for talent. Downside is there are still disruptions in workflow and tech availability, which can push software or products back. As exhibited by how many big title delays happened in the games industry especially.
Additionally, various gaming companies experimented with instituting four-day work weeks, meant to alleviate crunch and provide a more balanced work-life dynamic. Eidos Montreal, Eidos Sherbrooke, Kitfox Games, Armor Games, ManaVoid Entertainment, Young Horses Games and Crows Crows Crows are examples of studios that have shifted towards this type of schedule while maintaining pay levels for their employees. Not only is it promoting work-life harmony, it’s an excellent bargaining chip for companies when attracting talent.
Microsoft & Activision Blizzard Facing Regulatory Scrutiny & Sony’s Ire
It’s hard to believe that Microsoft announced its $69 billion purchase of Activision Blizzard this past January. It feels like the biggest story in gaming, perhaps ever, and the resulting talk about further consolidation in the games industry has been in the news cycle for an eternity. The company’s representations argue that it will actually increase competition and aid development resources because of access to Xbox Game Pass and more direct financial support, and has offered good faith deals to Sony, Nintendo and Valve to have Activision’s bellwether franchise Call of Duty remain on other platforms for at lease a decade. So far, only Nintendo and Valve have accepted.
While certain jurisdictions like Brazil and Saudi Arabia have already approved the deal, other regions and countries are scrutinizing it closely. Namely the United Kingdom’s Competition & Markets Authority (CMA) and now Lina Khan’s Federal Trade Commission (FTC) here in the United States, the latter of which is seeking to potentially block the purchase by pushing the Seattle-based tech giant towards a major legal battle. Then of course there’s Sony, Microsoft’s main competitor in the premium console space, that’s naturally opposed to it. Personally I still think the acquisition will happen, perhaps with some conditions, just not before Microsoft’s target of June 2023.
Supply Chain & New Gaming Hardware Inventory Rebound
Can you believe it’s been two years since the launch of Sony’s PlayStation 5 and Microsoft’s Xbox Series X|S family? And almost a year since Valve’s Steam Deck handheld (a device from that I think has revolutionized PC and portable gaming)? To say it’s been a tumultuous beginning to the new console cycle is an understatement, as supply disruptions plus chip shortages have made it difficult for consumers to find these boxes at retail. Though after a rough stretch in the front half of the year, indicators are finally signaling better availability.
Supply chains are improving, part prices are topping out and suppliers are pushing more inventory to market. This is illustrated by better hardware results lately for key markets like the United States, where both new families have been growing, sometimes in the double-digits. Data from a Top 5 global games market in the United Kingdom show that November was the biggest month of 2022 for console sales. Valve’s Steam Deck shipments have risen drastically since the February launch, when the company was dealing with slowdowns amidst long waiting lists. There’s also Sony’s upbeat target for hardware shipments during its current fiscal year. It’s safe to say these stats are pointing to a positive trend, and certainly bodes well for the new year, during which I expect upward growth for all three devices.
Weakness in Mobile Drives Lower Spending on Games Industry
Admittedly this is a miss for me when it comes to my prediction, as I expected global games industry value to be flat or up slightly in 2022. The reason? Mainly because I was more optimistic than I should have been on mobile. Even with the late year output push by hardware manufacturers, spending across games is trending downward for this past year. Both globally and within the United States, as Newzoo expects the former to decline 4% to $184 billion and The NPD Group currently shows domestic spending down 6% to $48.97 billion through November.
At a global scale, mobile’s value is trending 6% lower to $92 billion. Within the United States, this sub-category is likely to show between a 1% to 2% dip. To illustrate how significant this is, that would be the first time in Sensor Tower’s tracked history in which mobile experiences an annual decline. And it usually makes up half or more of the Video Game Content category, which is the largest contributor to U.S. spending. Combine mobile weakness with the impact of a sparser release calendar for premium games and global hardware sales looking to move down 4% to $52 billion, and 2022 is trending closer and closer to pre-pandemic levels.
Continued Expansion of Subscriptions, Streaming & Cloud Services
As expected by nearly every talking head that covers consumer sectors and technology, including yours truly, 2022 showed further movement towards subscriptions, streaming and cloud across various media types. These sorts of ongoing digital content distribution strategies are all the rage at companies, from Walt Disney Co’s Disney Plus and Warner Bros’ HBO Max to Microsoft’s Xbox Game Pass alongside Sony’s PlayStation Plus. This past year featured many avenues to watch television shows, check out new films and enjoy game libraries, whether locally or on streaming devices. Disney Plus recently passed 164 million subscribers, up 12 million year-on-year. The combined audience of Walt Disney’s streaming platforms rose almost 4 million in the quarter ending September. While Netflix’s user base initially declined in the early parts of its latest fiscal year, it’s since rebounded to 223 million after adding 2.4 million in the latest quarter, above estimates.
In gaming, Sony rebranded its PlayStation Plus service back in June to offer certain new titles as part of the Premium tier. Microsoft said Xbox Game Pass is showing growth on console and PC, though the former is slowing as the market saturates, and shared that 20 million people have used its cloud streaming tech which is twice as many as in 2021. Finally, Microsoft signed a deal to offer Xbox Game Pass on new Samsung televisions, a move that further exhibits how distribution will be in the future without even a need for gaming hardware. Digital is now dominant in these sectors with its allure of ongoing revenue and audience retention, and I expect even more segmentation across 2023 and beyond.
There you have my coverage of the biggest trends of 2022. Thanks for reading this far! Head back to the 2022 Year-in-Review Megapost for all year-end content here at Working Casual, and be well everyone.
Sources: Chris Chang (Image Credit), Company Investor Websites, GamesIndustry.Biz, Getty Images, Newzoo, The NPD Group, Owl Labs, PlayStation Blog, Sensor Tower, Social Shephard, Statista, ThisisEngineering (Image Credit).
It’s the last week of 2022. Which means one thing, of course.
We’ll see the ball drop soon on the new year? Well, maybe. But actually: It’s time for Working Casual’s annual Year-in-Review series!
This will be the sixth installment of the perennial article set celebrating gaming, media, technology and the trends, companies and smaller teams making big impacts across these sectors.
In a broad sense, major stories within these included the evolution of hybrid working, supply chain and logistics recoveries, better widespread unionization efforts, subscription services rebranding towards growth, cloud gaming expansion, major delays for AAA titles, general consumer spending declines, ongoing games tapping the Metaverse, the volatility of cryptocurrency, and, a personal favorite, the innovation of Valve’s Steam Deck on the gaming hardware front.
Throughout the next week, I’ll have multiple articles covering everything that was the past year. Trends, companies, indie studios and my favorite games will engulf the site like fireworks in the night sky. See below for the article titles. I recommend bookmarking and checking back often as I post them leading up to New Year’s Day.
Awards season? Well, technically yes. I’ll certainly be writing my Year-in-Review articles soon enough! And gaming’s biggest night in The Game Awards aired last week, showcasing the best of the year that was 2022.
What I really mean it’s when The Holiday Sale Season ramps up for video game companies and their efforts to push as much as they can to gamers everywhere. Any time people are shopping, I’m here to analyze sales results.
Because of that, today I’ll be recapping The NPD Group’s recent report on U.S. game sales during the highly-coveted month of November bolstered, of course, by Black Friday. It’s the time when manufacturers and retailers employ strategies to attract people to open those wallets.
And it was a very good month at that, especially in the context of 2022 so far. It’s the first month of the year in which monthly sales increased across the games industry. This is a huge data point given the general economic environment. It continued the strength from October, where buying leveled off after 11 consecutive months of declines.
Overall consumer spending on gaming rose 3% in November, signaling that easing inflation and better supply conditions for hardware proved to be tailwinds for the industry. Out of the three categories of Video Game Content, Hardware and Accessories, only Content saw a decline year-on-year mainly due to ongoing mobile weakness. Both Hardware and Accessories generated double-digit growth, the former boasting a substantial gain over last year’s figure.
There’s a few underlying reasons why November came in above expectations. First the release calendar has been stacked the past two months with commercial darlings, including the likes of Call of Duty from October then new titles in long-running series like God of War, Pokémon and, yup, even Sonic the Hedgehog!
Then, the improved stock of consoles, notably for Sony’s flagship PlayStation 5, is getting better at meeting consumer demand. Additionally, The NPD Group cited areas like non-mobile subscription spending, peripherals and digital full-game downloads on consoles spurring growth as well. All of these combined for a terrific month of higher sales.
On the premium software side, Call of Duty: Modern Warfare 2 continued its reign as the top-selling game during November, which it also accomplished the month prior around its debut. Just below that, three brand new games arrived within the Top 4: God of War Ragnarök, Pokémon Scarlet & Violet plus Sonic Frontiers. I’ll dive more into each later in the piece.
Within Hardware, PlayStation 5 was November’s best-selling console as measured by both dollars generated and units sold. Considering some discounting of its Xbox Series X|S competitor and the launch of mainline Pokémon games for Nintendo Switch, this win for Sony is quite impressive.
“I wasn’t expecting that we’d see any month with growth in 2022, but here we are,” said The NPD Group’s Mat Piscatella on LinkedIn. “Great new games sell really well. Would be great if more were released. The big uptick in new generation hardware supply sure helped too. Really fantastic month overall, especially when considering all the other market challenges out there.”
Here’s a look at the full report alongside my usual rundown. Get your hot cocoa ready!
United States Games Industry Sales (October 30th, 2022 – November 26th, 2022)
As shown in the info-graphic above, spending across all of gaming reached $6.29 billion in November, indicating the aforementioned 3% growth. Last year, this total was roughly $6.11 billion. For more context, November spending peaked at an all-time high back in 2020 when it reached upwards of nearly $7 billion.
Expanding to the year currently through 11 months, buying is still down 6% to $48.97 billion. Last year’s figure as of November was $52.19 billion.
The largest segment of Video Game Content hit $4.74 billion last month, or 75% of the total, which equates to a decline of 5%. In an ongoing surprise to those of us who track this regularly, mobile continued to drag down the category so much that things like premium games and other software-related sources weren’t able to offset its losses.
“Thanksgiving and Black Friday did not bring a reprieve as [mobile] spend during the week was down 5% year-over-year and 1% from 2020,” said Sensor Tower’s Dennis Yeh in the report. “Barring a meteoric (or catastrophic) final few weeks of 2022, annual U.S. mobile gaming spend should decease 1% – 2% from 2021.”
Mobile’s best-seller list was topped by the likes of Candy Crush Saga, Roblox, Royal Match, Coin Master and Clash of Clans. Indicators showed that casino, action and tabletop mobile titles ramped up in popularity during November, while role-playing and shooters were “struggling.”
Swapping to premium software, Call of Duty: Modern Warfare 2 repeated at the top spot during November and continues to be 2022’s leading seller. Activision Blizzard’s military shooter likely benefited from the launch of its Warzone 2.0 battle royale counterpart, plus it now has a full month of retail sales on the books. Nothing shocking about this particular result.
The first new release on November’s combined software list was God of War Ragnarök fighting its way to the 2nd spot. Comparatively, its predecessor in 2018’s God of War earned the top spot when it released in April of that year. Sony’s major exclusive for the back half of 2022 really only missed out on leading the month because it went up against the juggernaut that is Call of Duty.
PlayStation’s Game of the Year candidate is immediately among the Top 5 best-selling titles of 2022. This domestic success parallels its epic global start as the game shipped a staggering 5.1 million copies during its first five days. This is a record launch among first-party games in PlayStation history. Boy, that’s a whole lot!
Speaking of a great start, next up was the latest pair of Pokémon titles in Scarlet & Violet on Nintendo Switch which combine to reach 3rd place. A couple caveats being this includes full sales of both games, then excludes digital because Nintendo still doesn’t want to share that data. To compare against recent entries, Pokémon Legends Arceus started in first during (an admittedly less busy) January earlier this year while November 2021’s Brilliant Diamond & Shining Pearl also debuted in 3rd.
Pokémon Scarlet & Violet already occupy the 7th spot on 2022’s best-seller list. Beyond the domestic result, it’s a historic beginning for this game worldwide, shipping a whopping 10 million units within its first three days. That’s the fastest-selling on any Nintendo platform. Ever. Its monstrous launch set records for the series, Switch as a console and across Nintendo’s entire history!
Moving over to Nintendo’s 1990’s era rival in Sega, the #4 spot on November’s list went to Sonic Frontiers. It’s a rare appearance from the Blue Blur, as there haven’t been many mainline Sonic releases lately. Sonic Mania was a critical success back in 2017 then didn’t sell enough to chart at the time. This latest 3D platformer in Sonic Frontiers is turning out to be quite a fast seller, fittingly, moving 2.5 million copies worldwide within a month on sale.
Familiar names and big movers filled in the remainder of the overall ranks in November. Marvel’s Spider-Man: Miles Morales and Mario Party Superstars jumped back into the Top 10. The only other brand new title among the Top 20 was Tactics Ogre: Reborn slotting in at #17, which really is remarkable amidst plenty of big hitters.
Shifting to the 2022 list with just one month to go, Call of Duty: Modern Warfare 2 edges into first place. As expected. It’s the first time since Elden Ring dropped in February that FromSoftware’s masterpiece hasn’t held the year’s top spot. Past that, Madden NFL 23 has secured 3rd as Lego Star Wars: The Skywalker Saga moved down to 4th. MLB: The Show 22 seems to be impacted the most by new entries ahead of it, however it still retains a Top 10 position for now.
Check below for all premium software ranks for November and 2022 to date.
Top-Selling Games of November 2022, U.S., All Platforms (Physical & Digital Dollar Sales):
Call of Duty: Modern Warfare 2
God of War Ragnarök
Pokémon Scarlet & Violet*
Sonic Frontiers
Madden NFL 23
FIFA 23
NBA 2K23*
Gotham Knights
Marvel’s Spider-Man: Miles Morales
Mario Party Superstars*
Elden Ring
Animal Crossing: New Horizons*
Mario Kart 8*
Mario + Rabbids: Sparks of Hope
Persona 5
NHL 23
Tactics Ogre: Reborn
Minecraft
Horizon Forbidden West
The Legend of Zelda: Breath of the Wild*
Top-Selling Games of 2022 So Far, U.S., All Platforms (Physical & Digital Dollar Sales):
Call of Duty: Modern Warfare 2
Elden Ring
Madden NFL 23
Lego Star Wars: The Skywalker Saga
God of War Ragnarök
Pokémon Legends Arceus*
Pokémon Scarlet & Violet*
Horizon Forbidden West
FIFA 23
MLB: The Show 22^
Call of Duty: Vanguard
Gran Turismo 7
Mario Kart 8*
Kirby and the Forgotten Land
Gotham Knights
Minecraft
NBA 2K23*
Nintendo Switch Sports*
Marvel’s Spider-Man: Miles Morales
Animal Crossing: New Horizons*
The biggest boost to overall spending last month came from Hardware as a category. Console sales rose a momentous 45% during November, reaching upwards of $1.25 billion. This is a stark contrast to the 10% decline during October, which was mainly driven by weakness in Nintendo Switch. Seems like Nintendo may have been holding shipments to attract buyers during the more competitive time frame, or people weren’t as interested until they began Black Friday and pre-holiday shopping.
This excellent monthly result means that 2022 sales have turned positive for Hardware. After trending down 2% as of October, this category is now up 6% for the year right now. It’s generated over $5 billion in sales through the first 11 months, compared to last year’s $4.74 billion.
Funny how that happens when people can actually buy a console if they want it! And the demand is certainly there, as strong as it’s been early in this generation.
Benefiting from a generous supply improvement, the PlayStation 5 earned the top spot in the segment during November by both dollars and units. By my count, that’s four months in a row where Sony’s newest generation has led the segment by both metrics.
Nintendo Switch came in second place by both metrics. While The NPD Group didn’t share growth statistics for individual platforms, like it had in recent months when Xbox and PlayStation families showed double-digit growth, I’d imagine that all three major platforms gained ground based on how the category fared.
After this latest monthly win, PlayStation 5 remains the best-selling hardware platform of 2022 in year-to-date dollar sales. Hanging in there in its own right, Nintendo Switch leads in units.
This dynamic of added availability, especially for PlayStation 5, combined with both an ongoing appetite and better buying power from consumers is providing a boon for hardware late in the year. The perfect time for it to happen for these manufacturers, because they are able to meet the demand during the crucial holiday months. Two years into the new generation, we’re finally seeing the supply side of the curve catching up to demand.
Another solid result during November’s report was Accessories, which often benefits when people spend more on consoles because they acquire peripherals and extra controllers. After moving down 8% back in October, this segment returned to positive territory last month netting $289 million in sales or 10% higher than this time in 2021.
That brings the year so far to $2 billion in spending on Accessories, which is currently trending down 9% due to weakness in earlier months.
Game pads and headset/headphone sub-categories in particular boosted Accessories as a whole during November. The top-selling peripheral last month was the PlayStation 5 DualSense Wireless Controller Galactic Purple, paralleling Sony’s win on the hardware side. While The NPD Group didn’t confirm explicitly, I’d bet Microsoft’s Xbox Elite Series 2 Wireless Controller remained the year’s best-seller due to its outsized price and revenue potential.
Taking everything from November, it was arguably 2022’s best sales result for the U.S. games industry. It’s refreshing to see sales growth again.
Last month was exceptional for consoles, as PlayStation and Xbox continue making up ground after a slower start plus Nintendo Switch is holding up well enough late into its life cycle. On the content front, mobile certainly presents a concern; for now, it’s premium sales of new and earlier games propping up that segment. And there was clearly a good amount of demand for peripherals late in the year.
Now, moving into the last month of 2022, it’s a crucial time that will determine where domestic sales end up for the year. I’m more upbeat than I was even a couple months back, even if I’m thinking we’ll see lower sales in 2022 than last year.
Which wouldn’t be bad at all. 2021 was a record year for domestic spending on games here after all, generating over $60 billion!
Unless December is a major surprise to the upside, I’m expecting total sales will be down for the year in the mid single-digits. Against last year’s $60.4 billion, assuming a 5% drop would bring 2022 to around $57.4 billion. This indicates a December month of roughly $8.4 billion, which would be an improvement since last year’s final month.
Even as a slight drop, almost $58 billion in spending would be a great result for 2022 given the economic challenges and downward pressure the industry has experienced most of this year. It’s not where the industry could be if supply constraints and a number of delayed games didn’t happen. The world is still dealing with a global pandemic during which working dynamics and supply chains shifted drastically.
As for individual predictions, again Call of Duty: Modern Warfare 2 will win December in the Content category. For 2022 in aggregate, I think the Top 3 top-sellers from November will hold serve and finish like that.
December will be much trickier for Hardware. Anecdotally I’ve been hearing more about Xbox Series X|S stock. We know Sony has been moving up its shipments. Nintendo is there for families and households looking for a better entry point. I’m guessing PlayStation 5 will lead December on both dollars and units, with Xbox Series X|S in second by dollars and Switch in second by units.
As for the year, PlayStation 5 will carry this late momentum to a win on revenue. Alongside, Nintendo Switch will take home the crown when measured by units.
So that’s the final thread I’ll be writing on NPD results during this calendar year, because December’s result will take place sometime in January. We’ll have to see how the predictions go, and if the industry surprises me as it often does!
If you want more on the report from The NPD Group, I recommend Piscatella’s thread that’s now on LinkedIn. He has more on platform charts and further details.
Hope everyone is safe and well going into the holiday season, and I’ll be back very soon with my Year-in-Review posts before diving into the new year. Thanks all for the continued support!
*Digital Sales Not Included, ^Xbox & Switch Digital Sales Not Included
Note: Comparisons are year-over-year unless otherwise mentioned.
Sources: Newsweek (Image Credit), Nintendo, The NPD Group, PlayStation Twitter, Sega Sammy.
Time is marching on through the latter parts of 2022, and with it comes the first monthly sales report of the fourth quarter from games industry tracking firm The NPD Group.
Ironically, considering it was the spooky season, October proved to be much less scary than most of the year as it broke a long-running downward streak. It’s the first month in exactly one year during which spending on games didn’t show a year-on-year decline, boosted by a new Call of Duty, improving hardware inventories and easing of inflationary concerns.
Overall consumer spending across the three categories of Video Game Content, Hardware and Accessories was flat year-on-year, as the largest category of Content moved up slightly. The Hardware segment dipped double-digits, primarily due to a decline in non-PlayStation or Xbox platforms, i.e. Nintendo Switch.
Not bad in general, considering this time last year was the best October on record!
It helps to feature what will likely be the year’s biggest-selling game in Call of Duty: Modern Warfare 2, which (expectedly) topped the overall software chart. That makes 15 consecutive years where a Call of Duty title won its debut month. Which is a staggering result for the annualized military shooter especially since many so-called experts have consistently, and incorrectly, called for its demise.
Not only that, as happens this later in the year, the premium software chart was sprinkled with a variety of additional new releases. October saw five new games rank within the Top 10, and three more between #11 and #20. In addition to the aforementioned Call of Duty, the likes of Gotham Knights, NHL 23, Mario + Rabbids: Sparks of Hope and Bayonetta 3 all generated enough revenue to start in the Top 10, driving Content spend upward despite softness in mobile.
Within Hardware, the PlayStation 5 continued its dominance in October, winning out by both dollar sales and units sold. As it has for three months now. What’s reassuring is how Sony’s family of PlayStation 5 devices along with Microsoft’s Xbox Series X|S family both generated double-digit gains. For four months running. Sensing a burgeoning trend now that supply is getting better? It just took a bit for this generation to get going, seeing as it began during a global pandemic and all.
“October growth in digital sales and subscriptions for console and PC video game content, driven in large part by the release of Call of Duty: Modern Warfare 2, was offset by declines in mobile content and hardware,” wrote The NPD Group’s Mat Piscatella on Twitter.
Signals in October and recent months point to a trend towards increased buying on premium software as the calendar became busier, demand meeting or exceeding console supply and spending bumping up because of it. Prices indicators overall are plateauing right now in the States, so spending power is better than it was earlier in the year. Even as folks are spending less on mobile, other areas are boosting the results.
Read more below as I dig into the domestic sales trends and list out the latest software rankings.
United States Games Industry Sales (October 2nd, 2022 – October 29, 2022)
Looking at the above slides provided by The NPD Group, total monthly sales across the U.S. games industry stayed constant since last year at $4.27 billion. The green trend-line, which shows percentage change against prior year, has been moving mostly upwards since mid-year. I’d say this is the single most important takeaway from recent reports. Essentially, the rate at which spending declined in the back half of the year is improving.
Expanding to the first ten months of 2022 now, spending is still down 7% at $42.7 billion. This is mainly due to headwinds within Content as Hardware is showing a modest decline. There’s worse-than-expected output from mobile and a lighter premium software release slate until just recently in the fourth quarter.
Content as a segment, which includes software sales in addition to subscriptions and mobile, has returned to year-on-year growth, edging up 2% in October to $3.7 billion. Its contribution to overall sales was nearly 87%, compared to 85.5% this time last year. As for annual figures so far, Content has contracted 8% to $37.19 billion. That’s an improvement since last month, when it was trending down 9%, due to the October growth boosted by big budget new launches.
Mobile is traditionally the largest contributor within the Content segment. Unfortunately, last month’s report doesn’t shed much light into this other than to state spending was lower year-over-year. One tidbit from a GamesBeat article highlights how mobile spending could decline in 2022 for the first time in tracked history, an intriguing dynamic given how people are on the go more lately.
Within premium, October’s winner of Call of Duty: Modern Warfare 2 is also already the second best-selling game of the year, behind only Elden Ring. One element here is how Activision Blizzard employed a more staggered launch schedule for this year’s title, which seemingly attracted people earlier. Its story campaign dropped on October 21st while the full game hit market on October 28th.
This domestic debut fits the broader narrative of Modern Warfare as the premier sub-brand within the series. This year’s game, which shares a title with the 2009 classic, generated $800 million during its opening weekend and reached $1 billion in sales within ten days on market, becoming the fastest-selling Call of Duty in history and second fastest-selling game ever behind Grand Theft Auto V. (No wonder Microsoft is willing to pay so much for the publisher.)
Moving down the list, Gotham Knights snagged second place in what I’d call the biggest surprise of the month. Despite middling critical reception, the Warner Bros-published game clearly benefited from brand awareness as part of the DC Comics universe. Even without the Bat himself being playable. As a quick comparison point, Batman: Arkham Knight started atop the June 2015 software chart.
Then it’s the sports games, All from American publisher Electronic Arts. Both FIFA 23 and Madden NFL 23 dropped a couple spots respectively to 3rd and 4th. The next highest-ranked new title on October’s list was NHL 23, which scored 5th. This is a notable improvement compared to its predecessor, which dropped at 9th in October 2021.
Coming up next at #6 was Nintendo Switch exclusive Mario + Rabbids: Sparks of Hope. The collaboration between Ubisoft and Nintendo is a sequel to Mario + Rabbids: Kingdom Battle, a title that launched one spot higher in September 2017. (When, I might add, my beloved Destiny 2 was the month’s top earner.)
The final new game among the Top 10 last month was another Nintendo Switch exclusive in Bayonetta 3. Platinum Games’ latest in the long-running franchise is the first to launch on Switch, landing in 9th. It’s tricky to compare to prior games because they started on the failed Nintendo Wii U, which had quite the limited install base. One caveat is digital is not included for Nintendo-published games such as this one.
In terms of other new releases securing spots among the Top 20, there’s Star Ocean: The Divine Force at #14 and Dragon Ball: The Breakers at #16, while PGA Tour 2K23 teed off one spot lower at #17. And while it’s not a brand new title, Persona 5 experienced a massive jump up to seventh place due to its release on a variety of new platforms, including Xbox and Nintendo Switch.
Expanding to the current annual ranks, Elden Rings has held off Call of Duty: Modern Warfare 2 for the time being. Bandai Namco announced recently that FromSoftware’s latest reached an impressive 17.5 million copies sold globally. I expect this dynamic in the U.S. will swap come next month, when Call of Duty: Modern Warfare 2 will become the year’s best earner. Otherwise, FIFA 23 bounces into the Top 10, settling at #8, while Gotham Knights continues its impressive start being already the 14th top-selling game of 2022.
Here’s the full list of best-sellers for last month and the year through October.
Top-Selling Games of October 2022, U.S., All Platforms (Physical & Digital Dollar Sales):
Call of Duty: Modern Warfare 2
Gotham Knights
FIFA 23
Madden NFL 23
NHL 23
Mario + Rabbids: Sparks of Hope
Persona 5
NBA 2K23*
Bayonetta 3*
Elden Ring
Mario Kart 8*
Splatoon 3*
Minecraft
Star Ocean: The Divine Force
Grounded
Dragon Ball: The Breakers
PGA Tour 2K23*
Nintendo Switch Sports*
NieR: Automata
Super Smash Bros. Ultimate*
Top-Selling Games of 2022 So Far, U.S., All Platforms (Physical & Digital Dollar Sales):
Elden Ring
Call of Duty: Modern Warfare 2
LEGO Star Wars: The Skywalker Saga
Madden NFL 23
Pokémon Legends: Arceus*
Horizon Forbidden West
MLB: The Show 22^
FIFA 23
Call of Duty: Vanguard
Gran Turismo 7
Mario Kart 8*
Kirby and the Forgotten Land*
Minecraft
Gotham Knights
Nintendo Switch Sports*
Saints Row
Madden NFL 22
Super Smash Bros. Ultimate
FIFA 22
Marvel’s Spider-Man Miles Morales
Console sales, which rose almost 20% in September, returned to a decline last month. Consumer spending on Hardware as a category declined 10% in October to $424 million. This happened despite solid double-digit growth for PlayStation 5 and Xbox Series X|S, implying that Nintendo Switch made up the difference on the downside.
Intriguingly this didn’t have a substantial impact on the trend for 2022 to date, as Hardware spend is currently $3.78 billion or 2% lower than last year’s $3.87 billion thru the same time frame. That’s only down modestly from a 1% decline as of September. This tells me that availability is still better than it’s been in a long while, even if Nintendo Switch is aging into the back part of its life cycle.
As I predicted would happen last month, I mentioned earlier that PlayStation 5 won October on both dollar sales and units. Sony has been able to shore up its pipeline and suppliers are outputting more boxes to meet demand, and those folks that want a PlayStation 5 are certainly buying when they find one. In my article on Sony’s recent rules, I noted that PlayStation 5 lifetime unit sales reached 25 million. While it’s currently selling at a slower pace than PlayStation 4, the company is way upbeat on the remainder of this fiscal year through March 2023.
One additional note from The NPD Group is Xbox Series X|S landed in second place during October, reaffirming my inference that Nintendo Switch is starting to saturate its potential audience.
On the year so far, PlayStation 5 continues its lead on dollar sales followed by Xbox Series X|S and Nintendo Switch, in that order. When measured by units, Nintendo Switch is still in the lead driven by its lower price point. PlayStation 5 is next, while Xbox Series X|S is in third by that metric.
This checks out, as the higher-priced current generation is making more money per unit sold than Nintendo’s older hardware. Not to mention, there’s more demand for the shiny new boxes. Though Nintendo does benefit from families and households buying multiple devices, a situation that will benefit it during this upcoming holiday period. The Switch recently passed 114 million units globally, still the third best-selling home and handheld console of all time.
In what I’d call the most disappointing result, mainly because it missed my more upbeat expectation after a solid September, Accessories experience 8% lower sales in October to $148 million. Apparently, a new game pad from Microsoft in the Xbox Elite Controller Series 2 Core wasn’t as attractive, maybe due to its pricing that’s above the likes of entry level controllers. Perhaps there were declines elsewhere that dragged the segment down.
Annual spending on Accessories for 2022 is currently down 12% from last year’s $1.95 billion, totaling $1.72 billion through the first ten months of this year.
During October, Sony’s PlayStation 5 Dual Sense Midnight Black was the month’s top-selling peripheral, a flip from September when it was the base level black Xbox Wireless Controller. Microsoft’s Xbox Elite Series 2 Wireless Controller is still tops for the year, as I confirmed directly with The NPD Group.
As far as monthly results go for commercial output of the domestic games industry, October was the steadiest in recent history. Prior to last month, we had seen 11 consecutive months of spending declines.
This sort of rebound is especially noteworthy since it’s compared against a record-breaking October last year. The Call of Duty effect is of course a big plus, alongside a great showing from Gotham Knights plus those annualized sports titles signaling a ramp up to the holiday shopping season.
Checking ahead to November, which includes the bellwether Black Friday period, I’m anticipating growth in overall domestic spending. Likely in the mid-to-high single digits. Mainly because of the better console inventories, massive PlayStation and Nintendo software launches and a chance for accessories to benefit from deals.
Even considering Call of Duty: Vanguard launching last November, I’m guessing the Content category will be flat or maybe a slight decline. I expect Call of Duty: Modern Warfare 2 will repeat as the top-seller, with both Sony’s God of War: Ragnarök and The Pokémon Company’s Pokémon Scarlet & Pokémon Violet close on its heels. Because the former includes digital, and it’s going to have a potential record-setting debut for a PlayStation exclusive, I firmly believe it can secure second place.
For Hardware, PlayStation 5 should take November on revenue as it will still retain its pricing. I’m much less certain on units sold. I think Nintendo Switch can win by this metric, given the incredible popularity of Pokémon as a franchise.
There we have the latest U.S. sales recap, and predictions as the year begins its end. I highly recommend checking out Piscatella’s thread here, a bittersweet one since apparently it will be the second-to-last NPD report on Twitter. The company is changing formats to a more formal press release style. You know I’ll still cover it here and on social media, regardless of how it’s announced!
Thanks everyone for taking the time to visit the site. Here’s wishing everyone a great November, and a Happy Thanksgiving to everyone that celebrates. Take care and be well!
*Digital Sales Not Included, ^Xbox & Switch Digital Sales Not Included
Note: Comparisons are year-over-year unless otherwise mentioned.
Sources: Activision Blizzard, Bandai Namco, GamesBeat, Newsweek (Image Credit), The NPD Group, Sony Corp.
The latest of the big three console manufacturers to report this quarter, behind Microsoft and Sony, shared its fiscal 2023 second quarter results out of Japan earlier today.
I’d call it mostly upbeat, as both sales and operating profit experienced gains, yet it’s also dashed with cautionary signals and statistics. There’s upside, partially due to the yen’s continued weakness, while headwinds on the supply side and an aging life cycle show signs of a console business slowdown.
Headlines include how Switch passed yet another sales milestone this quarter while Splatoon 3 made quite the splash for consumers after its release in September. Especially in its local Japanese market.
On the hardware side, Nintendo Switch lifetime sales reached 114.33 million after the company shipped 3.22 in the three months ending September. It’s only the third home console to pass the 114 million mark. Still, Nintendo is somewhat uneasy about this portion of its business going forward, reducing in its annual unit sales forecast.
Splatoon 3 was the headliner for new software, shipping a whopping 7.9 million units in less than a month on market. That’s a record-setting launch for the franchise by a wide margin, plus the second fastest start of any Switch game this calendar year behind only January’s Pokémon Legends: Arceus.
Looking briefly at financial performance during the first six months of the current fiscal year, Nintendo’s net sales and operating profit rose 5% and under half a percent, respectively. While hardware unit sales are down 19% for the year so far, software sales are up almost 2% which shows the resilience of Switch buyers and reflects the ongoing appeal of Nintendo’s quality titles. Even amidst economic slowdowns and inflationary pressure.
Thus, executives decided to increase their forward-looking forecast for both net sales and profit metrics other than operating income, the latter of which kept constant. As the Switch pushes into the late part of its life cycle, Nintendo remains upbeat on consumers buying content for it, especially given the upcoming calendar including a sizeable impact from Pokémon launches this holiday season.
“Although software sales accounted for a larger percentage of overall sales for our dedicated video game platform business, and first-party software accounted for a larger percentage of overall software sales, the gross profit margin remained at the same level as the same period last fiscal year.” the company wrote in its slides. “This was due to the addition of Nintendo Switch OLED Model to the hardware lineup with its lower profit margin compared to other models, and the increase in component costs due to factors such as the semiconductor shortage.”
Check below the folder for a full dive into Nintendo’s business during Q2, including company guidance and my personal predictions for the annual period ending March 2023.
Starting with Nintendo’s overall performance, net sales for the six months bumped up 5% to roughly $4.91 billion. Focusing strictly on the quarter ending September, this was up 16% to $2.61 billion.
As has been the case recently for Japanese companies, there’s currently an outsized impact from currency fluctuations which hits those that operate globally even more than the average. Currently, around 72% of Nintendo’s business is outside of Japan. Because of this, the company said the impact of exchange rate changes on first half net sales was upwards of around $480 million. Backing that out, revenue for this time might even be down 5%.
Personally, I tend to stick with the gross number because currency impact is something that’s faced by all global companies. It’s still good to understand how much it’s affecting a company’s business when a given local currency is dropping as precipitously as the yen.
Alright, enough of this currency exchange rate lesson. Shifting now towards operating profit, this particular metric rose slightly in the first half to around $1.65 billion. Strictly for the second quarter alone, it amounted to $887 million which grew more than 18%.
Essentially this shows how both net sales and operating profit increased by double-digits during Nintendo’s second fiscal quarter.
What kind of product category mix was underlying this movement? Well, for Q2, software amounted to almost 60% of total sales compared to 55% this time last year. It follows that hardware sales dipped to 40%, down from 45%. This reflects the shift away from Switch console contribution as the cycle matures, plus the challenges of production the manufacturer and its suppliers have faced lately.
“While hardware unit sales declined by volume year-on-year due in part to the semiconductor shortage, overall hardware sales increased mainly due to the depreciation of the yen.” the company’s slides noted. “Looking at our mobile and IP related business, royalty income remained stable, but income from smart-device content declined.”
To better understand the quarterly movement in sales and profitability within a broader context, you’ll see the first two charts below illustrating this movement over time and the next two are annual figures. It was the second best quarterly output in the last decade plus. Twelve-month trailing numbers are moving back in a positive direction. Nintendo’s business is proving to be resilient, notably due to high quality game releases plus the aforementioned currency movement, plus hardware is still selling when it’s hitting retail. Not to mention, people that bought Switches during the pandemic still seem to be spending on games.
How do Nintendo’s latest numbers stack up to the biggest industry peers and their gaming businesses? While Tencent doesn’t report until later in the month, its latest annual revenue was $24 billion. Sony’s gaming business generated $20 billion, while Microsoft’s Xbox division topped $16 billion. Nintendo is up next, with its current annual sales figure at almost $13 billion. However, Nintendo’s profitability is vastly superior to PlayStation; the former has generated more than twice as much operating profit in the last 12 months, $4.43 billion compared to under $2 billion. PlayStation’s investment in the new PlayStation 5 line of consoles, the Bungie acquisition and ramping developments in software and virtual reality are chomping a serious chunk of its bottom line.
Nintendo’s hardware business is clearly slowing in terms of share and shipments, however there are a number of bright spots showing that Switch’s life cycle is far from complete. In fact, it’s going to hit major milestones in the near future.
During the first six months of fiscal 2023, Nintendo shipped 6.68 million Switch units. This is 19% lower than the same period last year, when it was 8.28 million. The drop can be attributed to the base model, which produced 2.23 million units against last year’s 6.4 million. Obviously the OLED model saw tremendous growth considering it launched in October 2021. As it replaces the base version, it now makes up over half of Switch’s total unit sales.
The lifetime unit sales of 114.33 million is up 21.46 million since September of last year, when it totaled 92.87 million. Switch has maintained its respective spot as the third best-selling home and portable console of all time. The popular hybrid is closing in on Sony’s PlayStation 4, the second best-selling home console in history, which ended production recently at just over 117 million. Even further, the 118.69 million of Game Boy and Game Boy Color is also in sight.
By the end of Nintendo’s financial year in March 2023, if not the holiday quarter, the Switch will occupy the second spot on the all-time list for both home and handheld hardware. What a run! And it’s not nearly done.
All of these are based on the number of units shipped to retailers by Nintendo. Additionally, the company shared some insight into how it’s selling-thru to consumers. Compared to the July to September time frame last year, Switch is selling-thru at the same rate. From what I can see on Nintendo’s slides, sell-through last year was roughly 3.4 million units of Switch in the quarter and just slightly less this time around. Even though shipments declined by roughly 15% this Q2.
This was attributed to demand being stable, and the introduction of Splatoon 3 alongside its more ongoing titles that still attract interest. That second part especially is the driver of Nintendo’s ongoing attractiveness to buyers, and investors, plus its financial performance. Consistent demand for its hardware products bolstered by key exclusives, especially as the technology gap with modern consoles continues to widen.
Speaking of games, Nintendo Switch software unit sales rose a bit in the six month period, moving up 1.6% to 95.41 million. For the quarter ending September alone, it was exactly 54 million. Compare that to 48.6 million in the same 3 months last year and this reiterates what makes the company so consistent.
On the fiscal year so far, Switch has seen 15 titles ship a million copies or more. Eleven of these so-called “million-sellers” are published by Nintendo itself while the remainder are via external partners. While this is down from 18 in the same period last year, it’s still a healthy amount of games hitting this coveted milestone.
Unit sales for Switch games lifetime have now crossed the massive 900 million milestone. To be exact, 917.59 million games have shipped for the console. That figure was at 681 million this time last year, meaning over 236 million games have sold in the past year. It’s hard to put these numbers in perspective, other than to say that’s a heck of a lot. While it won’t quite hit 1 billion this fiscal year, it will certainly eclipse that the following year.
In the new release realm, Splatoon 3 blasted its way onto the market in September with that 7.9 million copies sold number. That includes 5 million from Japan alone! To help put this in perspective, here’s how its predecessors started during their first respective quarters: Splatoon 2 sold-in 3.61 million in 2017 while 2015’s original Splatoon debuted at 1.62 million.
First month sales of Splatoon 3 are already more than halfway to the 13.3 million lifetime figure of Splatoon 2! It’s already among the Top 20 best-selling titles published by Nintendo on Switch to date, coming in at #18. It’s truly become one of Nintendo’s flagship entries, and the biggest commercial success of its new IP this generation.
The other new title showcased in Nintendo’s earnings was Xenoblade Chronicles 3. Since its launch in late July, it’s accumulated 1.72 million in units sales. While that might not sound like a lot in the context of other Switch games, this is an exceptional result for the Xeno universe. Back in 2017, its predecessor Xenoblade Chronicles 2 started with 1.31 million and was the top-selling title ever for developer Monolith Soft at the time. Now, Xenoblade Chronicles 3 has captured that crown.
In other record-breaking news, Kirby and the Forgotten Land sold-in an additional 2.61 million units during Q2, making its lifetime total 5.27 million. This is substantial because it’s now the best-selling mainline Kirby game of all time, outpacing the 3.98 million of 2021’s Kirby Star Allies. Keep in mind, this is a 30-year old franchise in collaboration between Nintendo and HAL Laboratory. What a fantastic success story!
Elsewhere, Nintendo Switch Sports is now the 20th best-selling Nintendo-published title on Switch, reaching 6.15 million units. Mario Strikers: Battle League passed the 2-million mark, settling at 2.17 million. Then there’s more impressive milestones from Mario Kart 8 and Animal Crossing: New Horizons, which seem to stand out every time I write an article on Nintendo. Mario Kart 8 zipped past the 48 million mark, somehow selling 1.59 million in the quarter to reach 48.41 million lifetime. Animal Crossing: New Horizons is the latest in the 40 million club, achieving 40.17 million to date.
This is where I like to provide updates on subscription numbers for Nintendo Switch Online or any sort of engagement statistics from the company. And now I can! Nintendo’s corporate briefing, updated a day after its earnings report, said that Nintendo Switch Online now has 36 million members. Compare that to 32 million in September 2021. Also, the company noted that the (frankly made up) metric of “Annual Playing Users” rose to 106 million. It was 104 million last quarter.
Considering the macro environment right now and pressure on consumers from areas like inflation and the appeal of other entertainment verticals, Nintendo’s Q2 performance was mostly promising. Especially when looking at the quarter on its own, rather than the six months, which revealed double-digit gains for important financial metrics. As Switch approaches its sixth birthday in the midst of various economic challenges, the console and its games still hold mass market appeal.
Alongside, Nintendo provided updated guidance for the remaining six months of its fiscal year.
The company now expects to generated 3% more, or upwards of $12.3 billion, in annual net sales. This would be a modest 3% decline compared to the prior year. It also maintained its operating profit target of $3.73 billion, indicating a 16% decline.
“While there is a gradual improvement in semiconductor and other component supplies and a recovery trend in hardware manufacturing for Nintendo Switch, taking into consideration production and sales performances thus far, we have modified the Nintendo Switch hardware sales units forecast for the fiscal year,” said the company’s slides. “By continually working to front-load production and selecting appropriate transportation methods in preparation for the holiday season, we will work to deliver as many Nintendo Switch systems as possible to consumers around the world.”
Thus, Nintendo now expects to ship 19 million Switch hardware units in the year ending March 2023. That’s down from 21 million it expected last quarter. For reference, it shipped 23 million in the prior fiscal year. Based on the 6.68 million already on market in the six months ending September, that leaves 12.32 million during the back half. Most of that will have to come during the holiday period.
My forecast last quarter saw 20 million on the lower end. Based on where supply has been and Nintendo’s conservative tilt, I’m formally pulling down to a range of 19.5 million to 20 million.
And no, I don’t expect its price to increase.
The company’s estimate for annual software unit sales remained the same at 210 million, which would be down from 235 million in fiscal 2022. As I wrote last quarter, I’m a bit skeptical it can reach this mark. Especially now that The Legend of Zelda: Tears of the Kingdom has a May release.
Mario + Rabbids: Sparks of Hope and Bayonetta 3 launched a couple weeks back, though both remain more niche than many of their counterparts or mainline entries. The real drivers will be, of course, Pokémon Scarlet and Pokémon Violet. The franchise seems immune to over-saturation and sells big on a consistent basis. I’m expecting a grand entrance for these, with a potentially record-setting start. Otherwise, Nintendo’s slate in the coming months is light. Even the Super Mario Bros. Movie isn’t out until April!
The last item I’d like to mention is Nintendo’s announcement of entering into a joint venture with long-time partner DeNA Co. Ltd. Both companies have collaborated on the technical side of Nintendo’s account system along with mobile offerings since 2015, and this latest venture will even be a Nintendo subsidiary due to its size and capital structure.
“Based on the expertise accumulated over the seven plus years and the experience of co-developing multiple services based on Nintendo Account, Nintendo and DeNA will advance their partnership and establish a joint venture company.” said the company’s announcement. “With the objective to strengthen the digitalization of Nintendo’s business, the joint venture company will research and develop, as well as create value-added services to further reinforce Nintendo’s relationship with consumers.”
I welcome this sort of team-up, and really anything that can bring Nintendo’s digital capabilities and online services closer to its competitors.
With that, this concludes my third big recap of the last couple weeks. What stood out to you with Nintendo’s latest announcement? Do you think it can meet or exceed its latest targets? Are you planning to buy a Switch or any games in the coming months? Drop a line her or on Twitter, I’m always down for a discussion!
Feel free to hop back over to my earnings calendar to stay current, as there’s plenty of action still to come this season. Thanks y’all for visiting and I hope everyone is doing well!
Note: Comparisons are year-over-year unless otherwise mentioned. Exchange rate is based on reported average conversion: US$1 to ¥133.93.
