Analysts mixed on February software sales

Killzone 2 and SFIV expected to lead month as industry-watcher estimates put game revenues at $659M-$710M; GTAIV: Lost and Damned sales forecasted to be $21M.

Comments

Related
Killzone 2
Follow
Wii Fit
Follow
Street Fighter IV
Follow

The NPD Group will release its US sales recap for the month of February this Thursday, and a trio of industry analysts can't come to an agreement on whether the results will reflect a win, lose, or draw.

No Caption Provided

Pacific Crest Securities analyst Evan Wilson believes that the game industry matched its February 2008 performance, predicting software sales for the month will come in at $675 million. High-profile releases Street Fighter IV (Xbox 360, PlayStation 3) and Killzone 2 (PS3) led the sales for the month, Wilson believes that Call of Duty: World at War, Guitar Hero World Tour, Rock Band 2, Wii Fit, and Wii Play are also expected to perform well.

Wilson also noted that one to watch for in February will be Wii hardware sales, given that supply appears to have finally caught up with demand. "During the month of February, Wiis were largely in stock at major retailers," commented Wilson. "This does not appear to be a reflection of increased hardware deliveries. Instead, it was likely caused by the typical postholiday deceleration in demand and the existence of few new, big February releases. February data will be interesting, because they will be an indication of ongoing Wii demand rather than ongoing supply."

Although Wilson didn't take a crack at predicting Wii hardware sales, Wedbush Morgan Securities analyst Michael Pachter did. Pachter believes that Wii sales continued to soar in February, saying that he expects Nintendo to have sold 725,000 units on the month. That figure remains far higher than what Pachter believes Sony's or Microsoft's console mustered, with the former achieving 200,000 unit sales by his projections, and the latter logging 300,000 systems sold.

Pachter doesn't anticipate the PS3 to have seen much of a bump from the release of Guerrilla Games' highly anticipated Killzone 2, primarily due to the game's release late in the NPD's reporting period. However, Pachter does believe that the game helped drive software sales to $710 million, a 5.6 percent year-over-year climb. Other top performers during the period, as noted by Pachter, include Capcom's SFIV; Activision's Guitar Hero World Tour and Call of Duty: World at War; MTV Games' Rock Band 2; and Nintendo's Wii Fit and Wii Play.

Electronic Entertainment Design and Research analyst Jesse Divnich took the most pessimistic view of the US gaming industry's software performance. Divnich believes that software sales actually sunk during the month, a first since October 2008. According to the analyst, software came in at $659 million during February, a 2 percent year-over-year slip.

Divnich also expressed concern about the PS3's performance for the month, noting that the console is poised to log its fourth month in a row in which it saw year-over-year sales declines. Particularly, Divnich believes that Sony is losing the messaging war that the PS3 is the premier "core" gaming console.

"Case in point is Microsoft's recent announcement of a Resident Evil 5 hardware bundle, which is a deal between Microsoft, an American company, and Capcom, a Japanese company," observed Divnich. "Such a deal would have been unheard of in the last generation and its presence in this generation only reinforces the idea that even publishers are beginning to recognize the Xbox 360 as the superior console for targeting the core gaming market in North America."

Lastly, Divnich addressed the Xbox 360-exclusive Grand Theft Auto IV downloadable content, which will not be reflected in the NPD's monthly recap.

"EEDAR currently expects retail brick-and-mortar sales of Grand Theft Auto IV's Lost and Damned expansion to be under $3 million for the month--worldwide," he said. (The retail package contains a unique code that can then be used to download the game through Xbox Live.) "For digital distribution, we expect Lost and Damned to produce over $18 million in sales (worldwide). As we move forward, we expect that 6-to-1 ratio to grow even larger, as digitally distributed games don't have to succumb to retail pressures and loss of shelf space/visibility. Long-term, we expect Lost and Damned to produce up to $40 million in total worldwide revenue."

Got a news tip or want to contact us directly? Email news@gamespot.com

  •   View Comments (0)
    Join the conversation
    There are no comments about this story