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NPD: February Down 15 Percent On Lagging Unit Sales, Constrained Wii

NPD: February Down 15 Percent On Lagging Unit Sales, Constrained Wii Exclusive

March 11, 2010 | By Leigh Alexander

March 11, 2010 | By Leigh Alexander
More: Console/PC, Exclusive

Though revenues were down across the board year-on-year, February 2010 releases achieved big numbers, with 2K Games' BioShock 2 for the Xbox 360 leading the chart -- though last fall's big hits, such as Call of Duty: Modern Warfare 2, are still represented by strong sales.

According to the NPD Group, year on year, overall retail sales in the U.S. video game market are down 15 percent, falling to $1.26 billion from $1.48 billion.

Game software retail sales are down 15 percent, falling to $624.4 million from $736.7 million, while accessories are down a very minor 1 percent, at $204.7 million compared to last year's $206.1 million. Year to date, accessories are actually up slightly -- but that's due to higher prices, says the NPD's Anita Frazier.

"Sales came in slightly better than we anticipated (privately, we were forecasting down -19 percent)," says EEDAR analyst Jesse Divnich, who says Xbox 360 and PlayStation 3 hardware sales "exceeded expectations."

"Of course, stronger hardware numbers do influence software numbers as PS3 and Xbox 360 hardware purchasers typically purchase at least 1 software SKU attachment," he adds.

The Software

February's top 10 retail titles are as follows:

1. BioShock 2 (Take-Two, Xbox 360): 562.9K
2. New Super Mario Bros. Wii (Nintendo, Wii) 555.6K
3. Call of Duty: Modern Warfare 2 (Activision, Xbox 360) 314.3K
4. Just Dance (Ubisoft, Wii) 275.4K
5. Wii Sports Resort (Nintendo, Wii) 272.5K
6. Call of Duty: Modern Warfare 2 (Activision, PS3) 252.8K
7. Mass Effect 2 (EA, Xbox 360) 246.5K
8. Dante's Inferno: Divine Edition (EA, PS3) 242.5K
9. Dante's Inferno (EA, Xbox 360) 224.7K
10. Heavy Rain (Sony, PS3) 219.3K

It's worth noting that the PlayStation 3 version of chart-topping BioShock 2 did not chart at all -- notable, perhaps because the original game in the series released a late but acclaimed port to the PlayStation 3.

Frazier also noted that "Call of Duty: Modern Warfare 2 has become the third-best-selling game of all-time, now at just under 10 million units life-to-date."

The third-place debut of Ubisoft's casual Wii title Just Dance impressed EEDAR analyst Jesse Divnich, who comments: "Wow. I really hope Ubisoft is working on a Just Dance 2, because a sequel (released on the PS3, Xbox 360, and Wii) could be a huge success."

"These sales trends are similar to what we seen with Guitar Hero before it reached mainstream success," he adds. Just Dance 2 for the Natal, Move, and Wii? Sounds like a good strategy to me."

Frazier says that for most categories, year-over-year declines in unit sales were greater than dollar sales declines. "Higher average retail prices on all categories except console hardware boosted dollar sales performance somewhat," she notes.

"Honestly, I had expected the industry to perform somewhat better this month," Frazier continues. "Nonetheless, strong new releases and Easter gift-buying bode well for industry performance in March."

The Hardware

Console sales rose from January 2010 across the board, despite the shorter month, though hardware revenue was down 20 percent year-on-year, falling to $426.4 million from $534.2 million a year ago.

The console rankings and sales are as follows:

1. Nintendo DS: 613.2K
2. Xbox 360: 422.0K
3. Wii: 397.9K
4. PlayStation 3: 360.1K
5. PSP: 133.4K
6. PlayStation 2: 101.9K

Microsoft says that it was the best February in the console's history: "This month’s NPD results are a further proof point to what will be our biggest â€" and best â€" year in Xbox history," says Microsoft IEB COO Dennis Durkin.

Said Frazier, "Xbox 360 nabbed the top spot among the three console systems for the first time since September 2007 when Halo 3 was released. PS3 enjoyed a 30% increase over last year, even while retail supply is reported to remain constrained."

EEDAR's Divnich agrees with Frazier's perspective on supply constraints: "Our extensive retail channel checks have all indicated that, in fact, the Nintendo Wii is in short supply," he says. "We believe February numbers reflect entirely on the Wii being supply constrained and has little to do with declining demand of the product."

Separately, Sony confirmed it's been facing "tight" inventory -- but says it expects another month of 30 percent year over year growth in March, and that it's on track to see PS3's userbase hit 13 million units worldwide by the end of the month.

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