Last month's US retail sales figures from the industry-tracking NPD Group capped off a record-setting 2006 for gaming. Later this week, NPD will release its figures for the first month of 2007, and two analysts have already weighed in with their predictions. While both agree that the month will be up over January of 2006, they disagree greatly on how far up it will be.
In a note to investors, Pacific Crest Securities' Evan Wilson said January sales should be up about 13 percent year over year, for a total of $405 million. Specifically, the growth will be driven by games on the new generation of hardware and continued strength in software sales for older consoles. Wilson also noted that the NPD's reporting period for January 2007 actually spans five weeks, instead of the four encompassed by its January 2006 numbers.
Wedbush Morgan Securities' Michael Pachter also noted the five-week sales period and continued strength in the PlayStation 2 as reasons for growth, but he suggested a January sales bump of "at least 32 percent" to $475 million. He notes that the actual number could be significantly more if December's strong PS2 hardware sales led to people buying games to play on their new systems in January.
Pachter also said he assumed a low attach rate of 1.5 new games sold per PlayStation 3 and Wii system in the month in preparing his estimate, and the real number might be higher. Regardless, January is the first month Pachter expects next-gen software sales to exceed current-gen sales.