NPD: Q4 expectations for the US market

[Lelouch0612]

It is that time of the year again and Mat Piscatella, from NPD, gave its predictions and thoughts on Q4 for the US market.

My current expectation is that fourth quarter spending on video game content, hardware and accessories in the U.S. will increase 3% when compared to the fourth quarter of 2020, reaching $18.9 billion. Further, I expect that full-year 2021 sales will total $61.7 billion, an increase of 10% when compared to 2020.

I also expect to be wrong.

Mat's main predictions are the following :

• No relief expected for console hardware shortages
• Subscription and mobile will continue to thrive
• Nintendo Switch will lead the hardware market in unit sales, while PlayStation 5 will rank first in dollars
• Call of Duty: Vanguard will be the quarter’s best-selling game, but watch out for Grand Theft Auto: The Trilogy – The Definitive Edition
• Despite supply and production challenges, 2021 spending could set new records across all gaming segments

More here : https://www.npd.com/news/blog/2021/2021-u-s-video-game-industry-fourth-quarter-sales-expectations/


What are your thoughts on this and on Q4 overall in the US ?

 

[DarkDetective]

2021 has been the year of the delay, with the effects of COVID-19 on development cycles becoming very clear. As a result, the coming holiday quarter is relatively slow in terms of new software releases. Meanwhile, Q1 2022 looks crowded already, because companies give games more time, but they don't want to move them to the next fiscal year (a lot of companies end their FY on 31st March).

For hardware, I think it's all still supply-bound. PS5 and Xbox Series will sell all stock that's available. The lower amount of new software will have little effect on that.

For the Switch, there's the new OLED model of course, but that alone is not enough. There's Pokémon Brilliant Diamond of course, which will be massive. But what's the other show-stealer for them this holiday season? Mario Party Superstars? Dr. Kawashima's Brain Training? The other releases, such as Metroid Dread and Advance Wars 1+2, are good to keep the dedicated fan bsae engaged, but they do not move hardware. I would've expected another 6-8M type title from them, similar to Luigi's Mansion 3. I guess they want Metroid Dread to be that game, but as we discussed in another thread, it looks like Metroid Dread's potential is about half of that.

The software situation on PS5 and Xbox Series should be interesting. As I pointed out earlier, it feels like there's relatively few releases, which means more space for the games that actually do come out. Jurassic World Evolution 2 is a game that I think could benefit from that. The first game sold more than 3 million units. Marvel's Guardian of the Galaxy is another one. Let's hope this one gets a better reception than Marvel's Avengers.

In the shooter market, I have high hopes of Halo Infinite's free multiplayer, in combination with the singleplayer release on Game Pass. I hope Microsoft will communicate player numbers. Singleplayer and multiplayer combined, I think good hopes that we could see as many as 25M+ players by the end of November.

 

[rAndom]

I can see the predictions being correct, especially the last one. With the next gen consoles trending upwards and the Switch remaining strong, I expect a very strong Q4 as well.

 

[ArkhamFantasy]

I think it's been 10 years ago that i predicted that Activision would run COD into the ground like they did Tony hawk and rockband.

 

[Lelouch0612]

2021 has been the year of the delay, with the effects of COVID-19 on development cycles becoming very clear. As a result, the coming holiday quarter is relatively slow in terms of new software releases. Meanwhile, Q1 2022 looks crowded already, because companies give games more time, but they don't want to move them to the next fiscal year (a lot of companies end their FY on 31st March).

Agreed on your following points but that one, I don't agree with.

Q4 2021 is a quarter with Halo Infinite, Pokémon, Call of Duty, Far Cry, Guardians of the Galaxy, Mario Party, Battlefield, FIFA, Forza and even GTA.

It is a very strong line-up imho.

 

[Star Ocean]

Im expecting this Q mainly strong for Switch and for Xbox.

Playstation will focus on there usual November month but i see them also focusing a bit of EU as well this holiday as some regions are lagging behind vs last year.

Due to lack of releases and smart discounting, I see older games released this year getting legs and on new games back4blood might be surprise hit.

 

[storres]

I wonder if Pokemon can make top 3 this year? They are finally combined. GTA is a wild one since Take 2 doesn't report digital and that digital split will hurt it on the charts.

 

[DarkDetective]

Agreed on your following points but that one, I don't agree with.

Q4 2021 is a quarter with Halo Infinite, Pokémon, Call of Duty, Far Cry, Guardians of the Galaxy, Mario Party, Battlefield, FIFA, Forza and even GTA.

It is a very strong line-up imho.

Pokémon, Call of Duty and FIFA are there very year.
Forza is an annual franchise. It skipped a year now, but it used to be Motorsport and Horizon substituting every year for a decade straight.
Far Cry is the annual Ubisoft action-adventure game. Sometimes it's Far Cry, sometimes it's Assassin's Creed, sometimes something else.
So those games I consider constants.

I agree that the shooter genre is competitive this year with Battlefield and Halo next to COD.
My point isn't that there's nothing to play or anything like that, but the number of non-regular releases feels low. Yes, people will find something fun to buy and play. I'm not worried about that at all. But the season feels a bit slow from a release calendar perspective. Which means more room for the titles that are there.

 

[ILikeFeet]

I think it's been 10 years ago that i predicted that Activision would run COD into the ground like they did Tony hawk and rockband.

They knew the only way to prevent this is to go full factory. The fact we lost good studios to it is appalling

 

[Lelouch0612]

Pokémon, Call of Duty and FIFA are there very year.
Forza is an annual franchise. It skipped a year now, but it used to be Motorsport and Horizon substituting every year for a decade straight.
Far Cry is the annual Ubisoft action-adventure game. Sometimes it's Far Cry, sometimes it's Assassin's Creed, sometimes something else.
So those games I consider constants.

I agree that the shooter genre is competitive this year with Battlefield and Halo next to COD.
My point isn't that there's nothing to play or anything like that, but the number of non-regular releases feels low. Yes, people will find something fun to buy and play. I'm not worried about that at all. But the season feels a bit slow from a release calendar perspective. Which means more room for the titles that are there.

Not convinced the GTA trilogy will sell very well ?

Also I was thinking about the PS5 HW revenue > Switch HW revenue. Switch's will have an ASP increase with the OLED and they were already tacking close on that metric until now.

Very curious about how it would translate in units gap for this Q4.

 

[DarkDetective]

Not convinced the GTA trilogy will sell very well ?

It's not about sales, but the number of releases. I think the GTA trilogy has basically free play now so yeah, I wouldn't be surprised if it sold some ridiculous amount. I'm going with 8M+.

 

[Aquamarine]

Hardware-wise in the USA I expect lower supply levels for non-OLED Switch models, with widespread sellouts when OLED hit the market. Switch should maintain its wide popularity which is fantastic given that this will be its 5th holiday season. Typically Switch would be post-peak but the gens aren't as truncated as they used to be.

For PS5 I expect market demand to meet supply, essentially. However many Sony can make, they'll be able to sell, so it's up to how well Sony can source components due to the global chip shortage and their ability to continue to drive adjusted monthly growth.

And for Xbox Series X/S I expect the ongoing shortage of Series X to remain for a while, with a steady supply of Series S commensurate with market demand like PS5.

There are so many people interested in gaming that the entire market is buoyed by proxy. It's a wonderful time to be a gamer right now.

 

[Viridi]

For me it’s less the number of titles (though it does play a part) , but variety that has left this q4 feeling a little less interesting . Even while there are notable differences between Far Cry 6, Back 4 Blood, Battlefield 2042, Call of Duty Vanguard and Halo Inifinite , especially for fans of the genre. They still leave with a line up that feels a bit samey and needing you to be into “FPS” as a starting point , obviously this matters less in an already FPS oriented market like NA though but makes it feel different from last year .

Simiarly as noted a lot of the other titles are basically established annual franchise releases . Though I’m gonna make note it’s actually been two years without a new forza of any kind and obviously it’s been 5 years since the last halo. Of remaining titles for the year pretty curious about how Guardians of the Galaxy perform, and I expect GTA - The Trilogy: The Definitive Edition (or GTATDE for short ) to be a break out hit and potential top 10 maker .

 

[allan-bh]

I wonder if the supply chain problems that USA are facing will affect consoles this holidays. They are already supply constrained, imagine with this additional factor.

 

[Ghostsonplanets]

Pokémon BD/SP alongside Mario Party and the evergreens will mean that Switch will stay at the top of hardware sales for this Q4. Switch OLED will be the hot item of holydays, though supply constraints mean will it be hard to predict its effect on sales. PS5 and Series will remain supply bound and out of stock. Should be a strong quarter.

 

[Benji-Sales]

Its really interesting because you can't ever bet against Call of Duty (and I'm not) but I wonder if Vanguard sees a significant drop from both Cold War and Modern Warfare 2019

 

[Violette]

I was expecting Call of Duty Vanguard to come in hot and Battlefield 2042 to be a return to form. But it might be the other way around.

 

[Benji-Sales]

I was expecting Call of Duty Vanguard to come in hot and Battlefield 2042 to be a return to form. But it might be the other way around.

Yeah this has definitely been an interesting twist

I actually thought Battlefield 2042 would put a lot of pressure on COD this year and thought we might see a situation like we did with Battlefield 1 and Infinite Warfare where the two ended up being very competitive with one another in sales

But honestly the BF 2042 Beta felt VERY rough and like it needed to be delayed even longer until next year. I'm really interested how this all shakes out

 

[Kenka]

Based on what we know, I predict a flat Q4 basically on all metrics; the SWOLED falls short of the potential of a pro model and so I don't see the Switch sell more than last year. The Xboxes and Playstations will fly off the shelves just like they have done so far. However, I don't know how the marketshare of the different players will evolve; I think Nintendo will see its share decrease but I have no idea how much of it Sony and Microsoft will win and what the split between the two will be.

By the way, is there any potential reveal and release until the end of the year which could make things interesting? Two years ago, we had Ring Fit Adventure. I wonder if some late surprise might take the central stage this year.

 

[Lelouch0612]

Based on what we know, I predict a flat Q4 basically on all metrics; the SWOLED falls short of the potential of a pro model and so I don't see the Switch sell more than last year. The Xboxes and Playstations will fly off the shelves just like they have done so far. However, I don't know how the marketshare of the different players will evolve; I think Nintendo will see its share decrease but I have no idea how much of it Sony and Microsoft will win and what the split between the two will be.

By the way, is there any potential reveal and release until the end of the year which could make things interesting? Two years ago, we had Ring Fit Adventure. I wonder if some late surprise might take the central stage this year.

I don't see the Switch being flat in Q4 with the help of the OLED and a significantly stronger line-up that last year (Pokémon) + potential Switch Lite promotions.

As for the late surprise, I believe it is going to be the GTA Trilogy.

 

[Ghostsonplanets]

Yeah this has definitely been an interesting twist

I actually thought Battlefield 2042 would put a lot of pressure on COD this year and thought we might see a situation like we did with Battlefield 1 and Infinite Warfare where the two ended up being very competitive with one another in sales

But honestly the BF 2042 Beta felt VERY rough and like it needed to be delayed even longer until next year. I'm really interested how this all shakes out

I don't know why is that, but DICE has been limiting the BF franchise potential imo. First with the disaster that was BF V and now 2042, which was hyped through the roof ever since it's announcement as a return to BF3-4 form, had a very rough beta.

Based on what we know, I predict a flat Q4 basically on all metrics; the SWOLED falls short of the potential of a pro model and so I don't see the Switch sell more than last year. The Xboxes and Playstations will fly off the shelves just like they have done so far. However, I don't know how the marketshare of the different players will evolve; I think Nintendo will see its share decrease but I have no idea how much of it Sony and Microsoft will win and what the split between the two will be.

By the way, is there any potential reveal and release until the end of the year which could make things interesting? Two years ago, we had Ring Fit Adventure. I wonder if some late surprise might take the central stage this year.

imo the only way Switch will be flat is if OLED supply is really that constrained. Thing has been flying off the shelves. General consumers don't care that isn't the Pro. They look at a much better design and pretty screen and instantly want the device. I also agree with Lelouch that GTA Trilogy will be a surprise, given the amount of work and redesign they're doing.

 

[Shadow of the Void]

I'm with Kenka. I think Q4 will be about flat for the Switch, maybe ±3% from last Q4. The OLED will give a big boost for Switch sales in October relative to what we saw over the Q3 months, but it may not have a lasting impact, especially if Stock is an issue throughout the holidays. However, last October was a very strong month for the Switch with 736k sold. The OLED will probably not result in the Switch beating that this October, at least not by much. Unless Nintendo is doing some really big holiday deals this year, I don't see them busting previous holidays records for the Switch, either, at least not by much.

The only big first-party Switch titles this quarter are Pokemon BD&SP (which will have the biggest debut of any Nintendo game this quarter by far), Mario Party, and Metroid Dread. However, the first three Pokemon remakes do not appear to have moved a significant amount of hardware despite being popular games (there is that LE Dialga & Palkia Lite being released the same week, though, and LE systems are often quite popular and good at boosting sales). Mario Party games, despite having good legs, tend to start off slow and have never been associated with bumps in hardware sales. Finally, Metroid Dread, while it will likely set franchise records, still belongs to a series that is too niche to move significant amounts of hardware. While these games will probably move some hardware, it won't be much relatively speaking, and the OLED will be the biggest factor this quarter by far.

I'd say the Switch will end the quarter with around 4.1-4.3M units sold, with year-end sales of around 8.5-8.7M. Not a significant drop from 2020, though the drop was moderated by a strong January & February comparing to the pre-pandemic Jan. & Feb. of last year, as well as YoY improvements in June & July because of shortages in that period last year resulting in overall softer sales that the rest of the Q2-Q4 period (take away Jan. & Feb. and 2021 will probably lead by 600-800k).

As for the PS5 & XBS, those are anyone's guess. It's still a matter of supply at this point. If MS makes enough units, I think them having arguably the biggest non-Nintendo exclusive of the holidays in the so far well-received Halo Infinite could help them squeak out a narrow victory in December. But overall I think at best we'll see a good-but-not-great holiday season just like the 2014 holidays because of the stock issues. Maybe somewhere in the 4.5-5M range for sales of both platforms combined for the quarter.

 

[Kenka]

I don't see the Switch being flat in Q4 with the help of the OLED and a significantly stronger line-up that last year (Pokémon) + potential Switch Lite promotions.

As for the late surprise, I believe it is going to be the GTA Trilogy.

Sure, the Switch could sell more YoY but I prefer to be bearish. We don't know how long the SWOLED will be supply constrained and what the impact on the regular model will be in the forthcoming weeks. There just isn't enough data yet to pull conclusions.

Regarding GTA, I am really looking forward to the split between PC, PS4, PS5, Xbox One, Xbox Series and the Switch at launch. If it doesn't get released day 1 on Game Pass, I'd assume it could be something like 10% (PC), 55% (PS), 15% (Xbox), 20% (Switch). I know I am being super ambitious about the last one.

edit: I can't math

 

[Nocturnal]

I think Switch can be up YoY by more than 10%,
Last year it seemed they blew some of their load in September, this year the load is going to be blown in October due to the OLED launch and huge titles in the fall. The Switch could easily outsell PS5/XSX combined mainly because Nintendo scaled production a long time ago, while their competition are still in the early stages of their lifecycle. This year Nintendo are producing more units than last year and I'm expecting big OLED shipments to coincide with Black Friday and December. Nintendo was producing 30 million the main thing is getting the big holiday shipments on time and Switch's smaller size will help a lot.

However there is a caveat regarding supply chains, its possible that all hardware makers don't achieve full potential due to shipments arriving late and the strained nature of global supply chains.

Supply Chain is the biggest factor as to why I expect PS5 to actually end up third for the fall due to it's packing requiring more space than either Switch and XSX. I honestly think that the size of the PS5 will hurt it a little bit in the US and the UK this holiday, as every centimetre counts right now. However the gap between Sony and Microsoft in North America won't be big.

 

[Violette]

Yeah this has definitely been an interesting twist

I actually thought Battlefield 2042 would put a lot of pressure on COD this year and thought we might see a situation like we did with Battlefield 1 and Infinite Warfare where the two ended up being very competitive with one another in sales

But honestly the BF 2042 Beta felt VERY rough and like it needed to be delayed even longer until next year. I'm really interested how this all shakes out

I don't see the Switch being flat in Q4 with the help of the OLED and a significantly stronger line-up that last year (Pokémon) + potential Switch Lite promotions.

As for the late surprise, I believe it is going to be the GTA Trilogy.

However Battlefield 2042 ends up performing, it will be interesting to read the post mortem on the game. EA moved heaven and earth for the game. BF5 got its support cut early. The game has no single-player campaign with other modes being delayed. Need for Speed was delayed with Criterion being brought in to help with Battlefield.

 

[slavesnyder]

I don't see the Switch being flat in Q4 with the help of the OLED and a significantly stronger line-up that last year (Pokémon) + potential Switch Lite promotions.

As for the late surprise, I believe it is going to be the GTA Trilogy.

the vision of GTA on the go will push switch a lot. it's a very different cake they are aiming for.

 

[Kenka]

The Switch could easily outsell PS5/XSX combined mainly because Nintendo scaled production a long time ago, while their competition are still in the early stages of their lifecycle. This year Nintendo are producing more units than last year and I'm expecting big OLED shipments to coincide with Black Friday and December. Nintendo was producing 30 million the main thing is getting the big holiday shipments on time and Switch's smaller size will help a lot.

Reading you makes me realize that it wouldn't be bad for Nintendo to have a few components shared between the SWOLED and Dane. Common parts makes it easier to make long term deals with suppliers.

 

[Benji-Sales]

Yeah main issue for PlayStation 5 and Xbox Series is just simply supply

Both platforms will sell literally every console they ship this Holiday in the US because demand remains enormous but who knows how many they can actually make

 

[Nocturnal]

Reading you makes me realize that it wouldn't be bad for Nintendo to have a few components shared between the SWOLED and Dane. Common parts makes it easier to make long term deals with suppliers.

I'm sure that Nintendo has an advantage with suppliers because of the success in the past 30+ months, it's not just Switches they are shipping but a lot of physical media and peripherals. Their supply chain is simply more mature to meet the holiday demand, compared to the competition who haven't really hit the heights Switch has in recent years, especially during the holidays.

Also as @slavesnyder says, GTA on the Switch is an X Factor... I still am not sure what to expect from the game in terms of lifetime sales but it could be a huge factor this holiday as it's a totally different audience than what we normally associate with the Switch. I'm sure that if it's optimized well for OLED's portable mode it's going to lead to a fair few additional new adopters which is a bit strange considering the point of the Switch life cycle it's releasing.

But in other places I've maintained that the actual software peak is going to be in 2022, so it's kinda of the perfect time to release it..

 

[m051293]

So since Sep release got delayed - fun question lingers of if NSW stayed #1 this month, because with the OLED launch, it looks like October forward will be heavily in the Switch's favor for a while, especially if its appealing to repeat buyers. If it holds Sep, this consecutive month streak is going to get massive.

 

[Lelouch0612]

So since Sep release got delayed - fun question lingers of if NSW stayed #1 this month, because with the OLED launch, it looks like October forward will be heavily in the Switch's favor for a while, especially if its appealing to repeat buyers. If it holds Sep, this consecutive month streak is going to get massive.

Welfare has been monitoring the next-gen drops pretty carefully and he seems pretty confident that the PS5 will take the month.

Slowing demand and/or supply because of OLED/Vietnam weaken the Switch position for September, that's for sure.

 

[Star Ocean]

Yeah main issue for PlayStation 5 and Xbox Series is just simply supply

Both platforms will sell literally every console they ship this Holiday in the US because demand remains enormous but who knows how many they can actually make

Horizon and GoW release months, supply will be something to watch out for

 

[Nocturnal]

By the way do we have the estimates for Q4 2020 & Q4 2019?

 

[Shadow of the Void]

By the way do we have the estimates for Q4 2020 & Q4 2019?

Q4 2019

NSW: 3773k
PS4: 2048k
XBO: 1808k


Q4 2020

NSW: 4154k
PS4: ?
XBO: ?

To the best of my knowledge, we never got numbers for the PS4 & XBO for November & December last year. Apparently they did pretty awful, though. Stock was wiped out earlier in the year after the COVID bump resulted in far better than expected sales earlier in the year. I guess with those systems nearing replacement, Sony & MS were probably unable (and/or possibly unwilling) to ramp up production to meet unexpectedly higher demand for old hardware.

The Switch was up in Q4 2020 because of October, which saw sales more than double from Oct. 2019 (736k vs. 309k). The Nov.+Dec. period was actually down slightly overall.

 

[SoonyXboneUhh]

Quite conservative predictions, that should turn out to be right.

The one that could end up being wrong is PS5 having the highest $sales, because Nintendo just released a new more expensive SKU at $349 and the base Switch didn't get a price cut. Microsoft will also have a more expensive SKU in the Halo Infinite Bundle and those $sales are attributed to the hardware if it's a hard bundle.

And then there is the stock situation in general that makes it quite unpredictable.

 

[AuroraMusisAmica]

When is NPD for September '21? Usually it's the second Thursday of every month correct?

EDIT: Oh just saw that it got delayed. ^_^;

 

[Lelouch0612]

When is NPD for September '21? Usually it's the second Thursday of every month correct?

EDIT: Oh just saw that it got delayed. ^_^;

It has been on Friday over the past year but yeah it got delayed

 

[mbolibombo]

In regards: Grand Theft Auto: The Trilogy – The Definitive Edition

Rumored retail date is December with the digital release date early november I believe, and if I'm not mistaken with Take 2 not sharing digital numbers to the NPD anymore I'm not sure it would stand a chance to Call of Duty?

 

[slavesnyder]

In regards: Grand Theft Auto: The Trilogy – The Definitive Edition

Rumored retail date is December with the digital release date early november I believe, and if I'm not mistaken with Take 2 not sharing digital numbers to the NPD anymore I'm not sure it would stand a chance to Call of Duty?

if GTA beats call of duty, this would be a huge surprise.
it's three old games without online play that will sell extremely well, but cod should be the far bigger title with a lot more marketing budget.

 

[storres]

if GTA beats call of duty, this would be a huge surprise.
it's three old games without online play that will sell extremely well, but cod should be the far bigger title with a lot more marketing budget.

Also, the publisher isn't sharing digital sales with trackers.

 

[allan-bh]

In regards: Grand Theft Auto: The Trilogy – The Definitive Edition

Rumored retail date is December with the digital release date early november I believe, and if I'm not mistaken with Take 2 not sharing digital numbers to the NPD anymore I'm not sure it would stand a chance to Call

They still share, just don't allow NPD to include in the public chart.

 

[slavesnyder]

Also, the publisher isn't sharing digital sales with trackers.

this.
GTA is a phantastic game for digital, as you might always want to have it present on the go.
only thing that would be hurting is that you don't have to huge paper map. that's really sad.
well, maybe they won't put it in the box anyway as you'd need 3 of them, and that's so costly to produce.