'Madden' Fuels Video Game Sales in August
NEW YORK – U.S. video game sales jumped more than 46 percent in August, fueled by the latest "Madden" football game and soaring hardware sales, according to data from market researcher NPD Group.
Retail sales totaled $993 million for the month, up from $679 million in the same period a year ago. Year-to-date sales were $8.02 billion at the end of August.
"Overall growth this month was much higher than expected, however individual company sales results were mixed," wrote Wedbush Morgan Securities analyst Michael Pachter in a note to clients.
Overall software sales, he added, remain strong and "an upcoming price cut for hardware could help to alleviate concerns about slowing industry sales."
Hardware sales rose 94 percent to $384 million from $198 million. The Nintendo Wii came in as the top-selling console with 403,600 units sold, followed by the portable Nintendo DS with 303,300.
Sony Corp.'s PlayStation 3, launched last November along with the Wii, sold 130,600 units, below the 202,000 units sold of its still-popular predecessor, the PS2.
The Xbox 360 sold 276,700 units, up nearly 63 percent from the 170,000 units sold in July, boosted in part by a $50 price cut in early August.
Software sales rose nearly 23 percent to $488 million, up from $399 million a year earlier. It was led by Electronic Arts Inc.'s "Madden NFL 08" for Microsoft's Xbox 360 with 896,600 units sold, followed by "Madden" for the PS2. Rounding out the top three was "BioShock" for the Xbox 360 from Take-Two Interactive Software Inc.
Four games from Nintendo made it into the top 10, including "Mario Party 8" and "Metroid Prime 3: Corruption." Activision Inc.'s best selling games for the month were "Guitar Hero 2" for the PS2 and "Guitar Hero Encore: Rocks the '80s," also for the PlayStation 2.
Analysts called the month's sales solid, though Edward Urban from Bear Stearns said "the good news from a fundamental and share price appreciation standpoint is limited to Activision" among the companies he covers.
"Consistent with previous months, Activision gained market share while both EA and THQ Inc. once again lost market share (despite major releases from both of these companies)," the analyst wrote.
Activision's shares slid 16 cents to $19.79 in late morning trading.
THQ's shares climbed 5 cents to $26.20. Shares of Take-Two fell 16 cents to $16.12 and shares of EA rose 25 cents to $54.36.
Shares of video game retailer GameStop Corp. rose $2.17, or 4.4 percent, to $51.98 after hitting a 52-week high of $52 earlier in the day. The stock is up 89 percent since the beginning of the year.