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NPD February Up 28% as Wii, DS Dominate Hardware Sales

NPD February Up 28% as Wii, DS Dominate Hardware Sales

March 16, 2007 | By Staff

March 16, 2007 | By Staff
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More: Console/PC

The NPD U.S. game hardware and software totals for February 2007 are in, and console software sales are $441 million, up 28% compared to last year's $345 million. Game hardware sales, meanwhile, were up an impressive 98% to $402 million, thanks to stellar performances from Nintendo's DS and Wii hardware.

Dealing with software first, the top-selling title for the month was the Microsoft-published Crackdown for Xbox 360, which shifted an impressive 427,000 units, no doubt helped by a bundled Halo 3 beta opportunity.

The top five by unit sales was rounded out by the controller-bundled Wii Play for the Wii (371,000 units), Diddy Kong Racing for the DS (an impressive 262,000 units), Zelda: Twilight Princess for the Wii (130,000 units), and Guitar Hero 2 for the PlayStation 2 (also 130,000 units).

Wedbush Morgan's Michael Pachter weighed in with information on the software results for February: "The average selling price of all games (console and handheld, current and next generation) in February was $33.31, +11% over last February’s $30.05 ASP, with lower pricing on current generation and catalog software more than offset by higher pricing on next generation software." He added: "There were 10 games selling more than 100,000 units apiece in February vs. our estimate of seven and compared to five last year."

Pachter also analyzed the data by next-gen vs. current-gen category, noting: "Next generation (PS3, Wii, 360, PSP, DS) software sales totaled $275 million, compared to our $240 million forecast. The upside was primarily attributable to dramatically higher than expected sales of 360 and Wii games."

He continued: "Current generation (PS2, Xbox, GC, GBA) software sales of $165 million were lower than our expectations of $175 million. PS2 software sales were down 15% year-over-year, slightly below recent trends, but suggesting that strength on this platform may be sustainable well into 2007. Our full year forecast presumes a decline of 30% for PS2 software for the year, and it appears to us that sales will be sustainable at this level or better throughout the year."

Turning to hardware, the DS headed overall hardware sell-through with an impressive 485,000 units, followed by Nintendo's Wii, which sold 335,000 units despite continued issues with shortages. The Xbox 360 sold through a reasonable, if not spectacular 228,000 copies, and the PlayStation 3 slumped to a disappointing 127,000 units, despite no apparent shortages.

Elsewhere, the PlayStation 2 moved a still impressive 295,000 at its relatively cheap current price, and the PlayStation Portable sold 176,000, markedly behind the DS. Finally, the various varieties of the Game Boy Advance sold a not unreasonable 136,000 units.

In addition, the Wedbush Morgan report revealed that, through February 2007, U.S. cumulative hardware sales for Xbox 360 were 5.1 million units, Wii 1.9 million units, and PS3 1.1 million units. The U.S. hardware installed base currently stands at 25 million next generation consoles (including handhelds) as of the end of February (up from 21 million at year-end 2006).

The report also provided a little context, noting: "In 2006, console software sales (excluding PC) were $6.45 billion, a year-over year increase of 6%. Including PC software sales, 2006 industry growth was also 6%. 2006 was a record year for U.S. software sales, barely eclipsing the record set in 2004, and we expect 2007 growth of 17%."

Finally, the full Top 3 software charts for each individual system by revenue for February 2007 are as follows:

Xbox 360
1. Crackdown - Microsoft
2. Gears Of War - Microsoft
3. Major League Baseball 2K7 - Take 2 Interactive

1. Wii Play - Nintendo
2. Zelda: Twilight Princess - Nintendo
3. Warioware: Smooth Movies - Nintendo

PlayStation 3
1. Resistance: Fall Of Man - Sony
2. Virtua Fighter 5 - Sega
3. Major League Baseball 2K7- Take 2 Interactive

PlayStation 2
1. Guitar Hero 2 with guitar - Activision
2. MLB '07: The Show - Sony
3. WWE Smackdown Vs. RAW 2007 - THQ

1. Diddy Kong Racing - Nintendo, Nintendo DS
2. New Super Mario Bros. - Nintendo, Nintendo DS
3. Mario Kart DS - Nintendo, Nintendo DS

Analyst Michael Pachter's forward-looking conclusions regarding these complex but encouraging set of results? "Once supply and demand of the PS3 and Wii are in balance (expected in May), we think that hardware unit sales will be more modest than they were in the analogous period of 2002, when console prices averaged under $200. We continue to expect higher average console prices to be an impediment to rapid sell-through of hardware, and we expect cycle-to cycle declines of 10% or more for hardware sales to persist through the end of summer 2007."

He added: "We now expect software sales growth to continue at low double-digit rates through summer 2007 (in spite of year-over-year comparisons that average +20%)." Top March 2007 releases in North America are expected to include Ubisoft’s Ghost Recon Advanced Warfighter 2 (Xbox 360), Sony’s God of War II (PS2), and Electronic Arts’ Command & Conquer 3 Tiberium Wars (PC).

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