Analysts, console makers respond to July sales

Winners and losers picked for a traditionally slow summer month rife with sales surprises.

July is usually a very quiet month for game sales, representing the last lazy stretch of summer before Electronic Arts' annual release of Madden NFL and the murderers' row of blockbuster hits that usually carries the industry through the holidays. While the industry-tracking NPD Group yesterday released US retail sales figures for July showing the expected growth for the industry, there were plenty of interesting stories for analysts who looked beyond the recap numbers.

Foremost among those stories was that of Xbox 360 and PlayStation 3 sales. Sony cut the price on its 60GB PlayStation 3 by $100 to $499 during the month, and Microsoft openly admitted that its Xbox 360 hardware had been far too unreliable for its liking. While Microsoft bundled that admission with news that it was extending the system's warranty to cover certain types of failure to a full three years, many analysts expected news of flaky hardware to temper sales of the system.

Between the PS3 price cut and Microsoft's warranty woes, it seemed the time was right for Sony's system to beat out the Xbox 360 in the monthly sales race for the first time. Add to that the fact that Microsoft dropped the price of the Xbox 360 to spark sales in August, and July might have been the PS3's best chance to pull ahead. That didn't happen, as the 360 narrowly outsold its rival once again, 170,000 units to 159,000 units.

It's a trend that The simExchange analyst Jesse Divnich believes will continue at least through the end of the year. Basing his predictions on the futures trading of his site's prediction market, Divnich expects the Xbox 360 to have outsold the PS3 254,000 units to 155,000 for August. He also thinks Microsoft's system will beat Sony's on a month-to-month basis through the rest of the year.

Like many of his peers, Nollenberger Capital Partners' Todd Greenwald was impressed by Activision's performance for the month. Driven by sales of the Guitar Hero franchise and its newest addition, Guitar Hero Encore: Rocks the '80s, the publisher more than tripled its sales tally from July 2006. However, Greenwald also singled out Electronic Arts for some praise, as it was the best-selling publisher of the month, despite sales having been down 17 percent from the year before. Both companies are "on the verge of a very strong second half," Greenwald said.

Meanwhile, Wedbush Morgan Securities' Michael Pachter and Pacific Crest Securities' Evan Wilson both expressed surprise at the sales figures, saying that GameStop's record-setting second-quarter sales and the NPD Canada sales figures for July had both led them to expect more robust results for the US. Wilson noted that NPD changed the way it gathers data for the month, which might account for some of the discrepancies.

Naturally, the console makers saw an opportunity to spin the numbers to their benefit, and Microsoft, Nintendo, and Sony all touted their various triumphs for the month. While Microsoft touted its sales position over the PS3, it also dug a little deeper into the numbers. The company noted that NCAA Football 08 for the Xbox 360 was the best-selling title of the month, beating out the game's PlayStation 2 and PlayStation 3 sales combined. It also said that consumer spending for its system is double that of the PS3 and the Wii, and once again pointed to third-party success on its system. While third-party publishers have accounted for 22 Xbox 360 games in the top 10 since the year began, the Wii and PS3 have only had a single third-party top 10 appearance each.

Nintendo didn't have to look too deeply at the numbers to put its sales in a positive light, as the company merely pointed out that the Wii and DS are still the two best-selling systems on the market, and that Nintendo hardware collectively outsold all other systems put together.

Sony touted the fact that the PlayStation brand accounted for 31 percent more sales than it did during July 2006, and brought up the spike in PS3 sales by saying it was the console's best sales month since January. It also noted that the PSP faced some supply shortages as stock of the existing model is cleared out in anticipation of the redesigned model, due out September 17.

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Discussion

156 comments
hottstreetballa
hottstreetballa

lol all the people hating Sony...I'm not a fanboy keep in mind. But Sony will catch up with the sales, and they do have decent games that you can't get on 360...Resistance being one of them, and Haze just around the corner. And read the people reviews for Lair...despite its bad review from GS, most people actually enjoyed the game, not everyone is going to like a game. To each their own, right? And people keep forgeting about the PSN...its not solid yet but damn, free online play? So PS3 games are $60.00...while 360 you're payin to play online, PS3 you don't...theres one advantage and a reason that the price means **** compared to one another. PS3 is still a fresh console, give it time to get a good library, the more the price drops, watch the sales sky rocket....The Blu-Ray is a big bonus as well, and to whoever said the unknown potiential of Blu-Ray hasn't checked into Blu-Ray obviously...The funny thing is most ppl are like 360 VS PS3...when Wii is kickin both of their asses....lol To each Their Own, No need to hate on other systems, or "predict" what's going to happen, because honestly you don't know what's going to happen...All systems are powerful, and each have their own advantages/disadvantages...

MartyD82
MartyD82

As I said before, Sony's repeating a lot of Nintendo's previous mistakes right now. The big one being relying almost entirely on established brands for their success. I mean, let's be honest here. GTA 4 and Metal Gear Solid 4 will be great games. But, for the record, are they really innovative? Are they really doing anything drastically new or revolutionary the way GTA 3 and the original MGS did? They're basically what Super Smash Brothers: Melee and The Legend of Zelda: The Wind Waker were to the GameCube - superb updates to existing last-gen games, but little more. And much like how Mario and Zelda weren't enough to sustain Nintendo in the previous two generations, Solid Snake and GTA probably won't be enough to sustain Sony this time around (especially since the latter is also going to be available on the X-Box 360). For the record, I think Sony (ironically) made the PS3 TOO powerful. Because the average consumer just isn't ready to shell out $600 for a currently unproven form of technology (Blue-Ray disks), and eventually the graphics/technology on the PS3 will be beaten by the graphics/technology of the gaming systems being released four years down the road. So the system may be obsolete before anybody really has a chance to properly utilize it. Plus, much like the Sega Saturn's two processors (which Sega almost humorously boasted about in their TV ads for the system twelve years ago), the PS3's rather shoddy implementation of its grand technology is a big part of the reason why games are so expensive and difficult to produce. And Sony Fanboys, please lay off the hate mail because I owned all three last-gen systems (I admittedly own none of the next-gen systems at the moment), and the PS2 was my clear favorite. But it's hard to deny that Sony's own cockiness, as with a lot of other once-dominant developers, is leading them into a quick downward spiral.

LilMafia54
LilMafia54

and im still waiting for microsoft to fix my 360

panteral3
panteral3

you spin me right round, baby , right round..... like a broken record, all right...

checampbell
checampbell

i'm still stunned m$ are releasing a halo edition 360 console without bundling the game................?

Evilrudy
Evilrudy

This doesnt even state that PS2 outsold both of them worldwide.

whocares9
whocares9

I will never understand the appeal of the Wii. I have one and I have not touched it since I finished Zelda. I respect other people's opinions on wanting it I guess but I don't have to like it myself and I sure as hell don't have to try and understand it either. I had a strange opportunity to buy it so I did, I don't think I otherwise would. I think it sells well though because it really turns on the ipod crowd, wii looks great with anything from ikea.

ajy2
ajy2

Nintendo continues to print money. You could buy its high stock now and probably still profit after 4th quarter, crazy!

sdkingsht
sdkingsht

the general public are idiots. they'll buy anything and will always overpay for a product that's not worth the money. half of them have no idea what's going on and are just going off of hear say of other uninformed consumers. blind leading the blind.

spadewalker
spadewalker

why is everyone saying the ps3 sold more worldwide, if you want to count total sales the 360 sold a little over 11 million, the wii sold a little over 10 million, the ps3 only sold a little over 4 million

paladin75
paladin75

senjutsu: i think your wrong about that. PS3 outsold the 360 in JAPAN. I believe its due to the fact that they dont want to waste their yen on U.S a U.S made game console. Due to the "limited" amounts and high price hurt sony. I dont think that even with the price drop they still dont stand a chance(at least til mid 08- 09) with all the delays and stuff with MGS and other games.........And especially Tekken, whuts up namco?!?!?!?!

jagstar73
jagstar73

And big up japan, original bad boy game producers!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

jagstar73
jagstar73

[This message was deleted at the request of a moderator or administrator]

alfie1980
alfie1980

jm dude is right. i own both a 360 and a ps3 and if i didnt have either,i'd buy the 360 first. there are hardly any great games on ps3.And the best ps3 games are also out on 360 for less money. I've got call of duty 3 on 360 and i can tell u that the ps3 versions frame rate isnt up to it.same goes for graw2;it looks grainier and it chugs more.sort it out sony

MetalZombieII
MetalZombieII

All any of this means is that the industry as a whole is doing well. FullSurface, Um... the information above isn't from gamespot, it's from industry Analysts, they try to make their best guess as to what will happen in the market and other people bank on them being right, when they invest money in these companies. Oh and PS3 has not caught up to the 360 in sales. Why is it people always scream bias, when their system of choice is doing poorly and is painted in a bad light. XBOX owners did it last generation and now PS3 owner are doing it this generation. The PS3 is a great system to... watch Blue-ray movies on right now, maybe when there is more than 1 good game on it, it will be a great game system. And no I am NOT bias I own a PS2, XBOX, GameCube, XBOX 360 and a Wii, and if Sony can get their S**t together and starts putting out better games I will buy a PS3 as well.

kylestarr
kylestarr

jmdude: PS3 will not make good games till they drop the price and make better a better dev kit. publishers want business, therefore they will favor Wii and Xbox. I wish I could afford all 3 systems. They are all awesome. I'll stick with my Wii till I can afford the others and they settle for 1 version of their system.

senjutsu
senjutsu

what?? did they forget to say that the ps3 sold more than the x360 in the world? Damn Gamespot, they should have mentionned that the x360 is outselling the ps3 ONLY and ONLY in the US...

jmdude
jmdude

The PS3 will not beat their rival unless they make good games. My PS3 is dying because of awful games!!!!!

FullSurface
FullSurface

bro relax these sites are all biased, PS3 is on fire right now, jus sit back and watch PS3 already catch up to 360 in less than a year. wooooooooooow did u relize that. NO well live and learn

Valkron1
Valkron1

Okay, now I'm a little bummed out. Heavenly Sword just got a 7.0 from IGN. Lair got a 3.75 out of 5 from Gamepro. Folklore got a 65% average rating out of 44 reviews at Gamerankings. These were three of the top games for the PS3 this year. There is still Drakes Fortune, Rachet, and Warhammer, but I'm not too sure about those either. If I didn't already have a PS3 this year I would wait till next year and just buy Wii and 360 games. Live and learn I guess.

Kurtisadei
Kurtisadei

WOW, just WOW!!! Sony has 3 pieces of hardware making up the "Playstation Brand" and they still can't even account for a full 3rd of sales! And to Kurtisadei, which month? It happened like 2 or 3 times. LOL. i didnt know that. well still owned ;)

encryptkeeper
encryptkeeper

Doubt it surppo. The price cut won't last forever, and it doesn't look like they'll have anything killer for Christmas without GTA 4. As for the 360, they'd better stop putting their "exclusive" games on more PC so they can catch up in console sales.

encryptkeeper
encryptkeeper

Doubt it surppo. The price cut won't last forever, and it doesn't look like they'll have anything killer for Christmas without GTA 4. As for the 360, they'd better stop putting their "exclusive" games on more PC so they can catch up in console sales.

surppo
surppo

it looks like sony is finally starting to get in the game. even though it didnt sale as many units as the 360 it came close and for a sytem that cost 100 more that says alot. when they go back up on the price they need to bundle the system like they did in australia with two games and a extra controller or with a psp that would help justify the price for the holidays.

doctorj11111
doctorj11111

With Killzone 2 and Metal Gear 4 being delayed until 2008 for the PS3 and Halo 3 and bioshock available this year for the Xbox 360 who wouldn't buy a 360 over the PS3. Many of the other good games are on both systems and Madden 08 runs better on the 360.

Vyce3
Vyce3

Funny how this article doesn't mention that the 360 outselling the ps3 was only in the USA. Worldwide sales show the ps3 is still outselling the 360. And that's what matters : total sales.

Cretaceous_Bob
Cretaceous_Bob

OnlyTbone - No dude. When consumer choices are made known, the competition follows. If something fails, they will change their product to mimic something that succeeded. When the consumers make clear what they want to spend their money on, the market and all it's competition will follow. Not to mention, its the existence of these fanboys that keep the market balanced. If the Wii/360/PS3 didn't have fanboys, it'd fall off the market. If an expensive product doesn't satisfy someone to the degree that they'll champion it, it will fail. So way to go proving yourself wrong. Anything else you'd like to add?

digi_dragon324
digi_dragon324

fanboys are stupid. but they are where i get most of my knowledge from...

OnlyTbone
OnlyTbone

All these fanboys saying "GO 360" "GO Wii" "GO PS3" gosh people. If one console dominated the others and became a monopoly the prices of games would go sky high. Since we wouldn't have a choice of what system to buy games for that system could price games for whatever they wanted. FANBOYS SHUT UP!!!

osxgp
osxgp

It's ashame Sony isn't keeping the 60 GB version and that price point. Also, Microsoft will see an incredible rise in sales when the monstor called Halo 3 is released.

ashuncc2
ashuncc2

Owning a X360, it's good to see that they had a decent month with the PS3 $ drop.

PMatt722
PMatt722

too bad the PS3 will never sell well, i guess sony needs to stick with uhm? tvs?

Pedro7_2000
Pedro7_2000

WOW, just WOW!!! Sony has 3 pieces of hardware making up the "Playstation Brand" and they still can't even account for a full 3rd of sales! And to Kurtisadei, which month? It happened like 2 or 3 times. Kurtisadei DONT ANY OF YOU REMEBER THE TIME THE GAMEBOY OUTSOLD THE P3S FOR A MONTH(forgot which one)? CAN U SAY OWNED

death_link
death_link

These annalist got pwned by Nintendo. And the fact that predicting the future can be way too ramdom.

onlineps2player
onlineps2player

more and more profits for game makers!!! go ahead guys! we love you!!!!

myjota
myjota

why microsoft don't leave Japan?

Kurtisadei
Kurtisadei

psx_warrior said this: The Wii seems anymore to be having the same software problems the Gameboy Advance had. DONT ANY OF YOU REMEBER THE TIME THE GAMEBOY OUTSOLD THE P3S FOR A MONTH(forgot which one)? CAN U SAY OWNED

blackace
blackace

I think the Wii & XBox 360 will be strong sellers this holiday season. The PS3 will probably do much better next year, especially if they announce a REAL price drop at the E3. If they get it down to $399 it should sell very well. By that time there will be a lot of quality games for it. Of course if M$ drops their Premium to $300 and the Core (which should be no more by then) to $250 or less, it still might be a pretty close battle. The Wii is going to keep selling strong throughout the holiday. With hit titles like Mario Galaxy, SSBB, Metroid 3, Donkey Kong: Barrel Blast, Battalion Wars 2, Fire Emblem:GoD & Harvest Moon all coming out this year, Wii fans will have much to play this holiday as well.

bluepuppy82
bluepuppy82

NinjaMunkey01: "I am not bothered by this. I already own all three consoles and the ps3 is my personal favourite console. the 360 has loads of games but is noisy and screams out old hardware and freezes from overheaying (even though I keep it well ventalated). the ps3 shows innovation and I cant wait for developers to get the ps3's power optimised and show what the console can really do. HURY UP DEVELOPERS!!!!!!!!!!! Cretaceous_Bob is right if people do not give developers a reason to continue with the ps3 then we will never see what it can do. but if developers are given the chance we will all be amazed by the graphics the ps3 can handle. we all want to see what it can do (even 360 fanboys most likely) but this may not happen." Who cares about a loud console. Turn up the volume on your TV and enjoy the billion of games available on the 360.

66Skullkid99
66Skullkid99

I don't see why to get a PS3 instead of a Wii or 360. Both consoles have got a larger library, and almost all the great PS3 games are in the 360 (Oblivion, Virtua Fighter 5, The Darkness, Fight Night Round 3). I really prefer Nintendo games and lots and lots of games launched to the Xbox 360 every day than only a long wait for Final Fantasy XIII, Metal Gear Solid 4 and Killzone 2. And the Wii Remote don't sucks, it is a wonderful piece of good control. You need to be very, very exigent and arrogant to don't liking it. Or very bad in playing.

sixpack_mac2001
sixpack_mac2001

I have still haven't purchased a next gen console. I'm waiting to see who wins the HD-DVD/Blue-ray battle. However, all these Xbox 360 hardware problems I hear about don't sit well with me. If the PS3 drops the price again, I think i'll go PS3.

NinjaMunkey01
NinjaMunkey01

I am not bothered by this. I already own all three consoles and the ps3 is my personal favourite console. the 360 has loads of games but is noisy and screams out old hardware and freezes from overheaying (even though I keep it well ventalated). the ps3 shows innovation and I cant wait for developers to get the ps3's power optimised and show what the console can really do. HURY UP DEVELOPERS!!!!!!!!!!! Cretaceous_Bob is right if people do not give developers a reason to continue with the ps3 then we will never see what it can do. but if developers are given the chance we will all be amazed by the graphics the ps3 can handle. we all want to see what it can do (even 360 fanboys most likely) but this may not happen.

Super-Mario-Fan
Super-Mario-Fan

Sony will be in third place this year for both sales and games. They better get thier asses moving.

SalarianChemist
SalarianChemist

Sony is in HUGE TROUBLE, in my opinion, and here's why: ALL THREE of Sony's games that were hyped ended up being BIG disappointments. Warhawk ended up being a disappointment in the reviews. Warhawk was rated only a 6.5 out of 10 by PSM magazine. Warhawk is called, "A third person shooter that never gets off the ground." This is NOT a surprise, because Warhawk REQUIRES at least two people to play, and there is NO MODE where Bots can be used in the place of people!!! THAT SUCKS!!! In Warhawk, the final version of the game ended up where machine guns from people on the ground can actually shoot down the Warhawk... That SUCKS!!! And men on the ground with rocket launchers can shoot the Warhawk out of the sky in one shot... That SUCKS!!! That is why Warhawk is rated so poorly. That's still better than Lair. Lair only got a rating of 5 out of 10 from PSM, and only 5.5 out of 10 from EGM. Heavenly Sword is another game that is receiving very "Mixed Reviews." Heavenly Sword received a rating of only 6 out of 10 from Edge. Heavenly Sword received a rating of 7 out of 10 IGN, and another 7 out of 10 from IGN UK. The 6 out of 10 from Edge is a REALLY BIG DISAPPOINTMENT for Heavenly Sword.