NPD: Behind the Numbers, November 2008
December 15, 2008 Page 7 of 7
Hitting $22 Billion?
In comments accompanying the media release on Thursday, NPD Analyst Anita Frazier commented that "the industry is still on pace to achieve total year revenues of $22 billion in the U.S." This expectation deserves closer scrutiny, since it tells us what kind of revenue the industry might realize in December.
As the graph above demonstrates, the industry will have to generate about $6 billion of revenue in December to reach $22 billion by the end of the year. That would represent year-on-year growth of 24 percent for the final month of 2008.
Looking at the first seven months of the year when year-on-year growth ranged from a low of 17.7 percent up to 56.6 percent, such expansion might have been natural, if not slightly pessimistic. However, growth has been much slower from August to November (ranging from -6.6 percent to 17.0 percent). Something exceptional will have to happen in December for growth to hit 24 percent over 2007.
If the industry maintains the growth shown in November, revenue in December could reach $5.3 billion and result in a more modest $21.3 billion for all of 2008.
As always, many thanks to the NPD Group for its informative monthly data on the videogame industry, and in particular to David Riley for providing additional information used in this article.
Page 7 of 7