Revenue

As we have seen for the past several months, the industry is on track for a record-setting year in revenue. Here is a comparison of revenue from 2008 and the previous three years, broken down by month.



As the above graph demonstrates, the $6.6 billion in revenue thus far in 2008 is more than the industry's total for January-October 2005, January-September 2006, or January-June of 2007. Industry sales are up 32% over the same period in 2007, and most of that growth can be attributed to the 45% increase in software dollar sales. The accessories segment, though a smaller part of the overall market, is up 29% for the year and hardware is up a more modest 17%.

In her notes to the press, NPD Group analyst Anita Frazier noted that the videogame market was on track to generate between $21 and $24 billion for the year. It is worth analyzing how she might have arrived at those figures.

In each of 2006 and 2007, the industry revenue from the beginning of January to the end of May represented 27.5% and 27.9% (respectively) of the full annual revenue. Should the same hold true this year, the full annual revenue for the videogames industry in the U.S. could be between $23.6 and $23.9 billion. Revenues that high would represent an astounding 31% to 33% year-on-year increase.

In 2005, the January-May revenue represented a more substantial 32% of total annual revenue. In that case, the annual revenue for this year could a be more modest $20.5 billion, or a 14.5% increase year-on-year.