Per the NPD Group’s latest report, one of the world’s largest market research companies, consumers spent a total of $977 million on video game hardware, software and accessories in May, accounting for sales, 52% higher than $642 million grossed in the previous year. Surge in sales was recorded across the board with hardware notching up 56% to $235 million while software sales jumped 67% to $438 million. Meanwhile, spending on accessories and game cards was recorded at $304 million, reflecting a 32% rise year over year.
Even though there were no breakout new releases, May was the third consecutive month to record strong year-over-year gains, buoyed by the COVID-19 lockdown with total gamers spending $5.5 billion so far this year, mirroring an increase of 18% over the 2019-level. Mat Piscatella, video games industry analyst at The NDP, reckons this as the highest year-to-date total since 2011’s $5.7-billion mark.
Hardware sales were driven by Nintendo Co’s (
NTDOY Quick Quote NTDOY - Free Report) Switch, which continued to be the top-selling game console in both unit and dollar sales, beating the Xbox One and PlayStation 4. Meanwhile, Microsoft’s ( MSFT Quick Quote MSFT - Free Report) Xbox Elite Series 2 Wireless Controller was the month’s best-selling accessory.
The top-selling video game of the month was
Call of Duty: Modern Warfare followed by Grand Theft Auto V and Animal Crossing: New Horizons. The other best-selling video games in the top 10 list included NBA 2K20, Mortal Kombat 11, Red Dead Redemption 2, Minecraft, Final Fantasy VII: Remake, Assassin’s Creed: Odyssey and Star Wars: Jedi Fallen Order. No new releases were among the top 10 best-selling games in May with Xenoblade Chronicles: Definitive Edition claiming the number one spot, placed at 14 th position on the all-platforms chart.
Needless to say, the report clearly showcases that stay-at-home orders were instrumental in aiding the recent growth rate in the video game industry. People remained indoors to find video games as their favourite quarantine pastime.
But will spending on video games continue? What will happen once the lockdown ends and people crawl back to normal routine? According to Mordorintelligence, the global gaming market is poised to witness a CAGR of 9.17% during the 2020-2025 forecast period.
At this stage, we think it is apt to invest in gaming stocks with strong potential. We zeroed in on five such stocks that carry a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see
. the complete list of today’s Zacks #1 Rank stocks here DouYu International Holdings Ltd. ( DOYU Quick Quote DOYU - Free Report) provides a game-centric live streaming platform. The company operates its platform on both PC and mobile apps. It has a trailing four-quarter positive earnings surprise of 127.90%, on average, and is presently a #1 Ranked player. Activision Blizzard, Inc. ( ATVI Quick Quote ATVI - Free Report) is a leading developer and publisher of console, online and mobile games. The company’s Call of Duty is one of the most popular gaming franchises globally. Its Overwatch League can be considered a pioneer in the e-sports space, conceptually. The company has a trailing four-quarter positive earnings surprise of 31.34%, on average, and a Zacks Rank of 1, currently. Nintendo Co. is a worldwide leader in the creation of interactive entertainment. It manufactures and markets hardware and software for its popular home video game systems including Nintendo 64 and Game Boy. The company has a trailing four-quarter positive earnings surprise of 48.62%, on average. The company is presently a #2 Ranked player. Capcom Co., Ltd. ( CCOEY Quick Quote CCOEY - Free Report) plans, develops, manufactures, sells and distributes consumer video game. Its operating segment consists of Digital Contents, Arcade Operations, Amusement Equipment and Other Businesses segments. The company, which is currently a Zacks #2 Ranked player, has an expected earnings growth rate of 29.63% for the current year.
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