Weekly Gaming Reports Recap: April 1 - April 5 (2024)
Two gigantic reports - about the PC/Console market from Newzoo & Mobile market from Sensor Tower are there.
Reports of the week:
Game sales Round-up (20.03.2024 - 02.04.2024)
Newzoo: PC and Console Games in 2024
AppMagic: Top Mobile Games by Revenue and Downloads in March 2024
Sensor Tower: Mobile Games in 2024
Game sales Round-up (20.03.2024 - 02.04.2024)
Neowiz reported that the number of players in Lies of P has exceeded 7 million. The game was released in September 2023 and has been available on Game Pass since day one.
Rollerdome has surpassed the milestone of 1 million copies sold. It took the niche game 2 years to achieve this.
The Dragonflight expansion for World of Warcraft finally brought the audience back to the game. Before its release, the game had around 4.5 million subscribers; now it's around 7.25 million.
Contraband Police from PlayWay sold 800 thousand copies. Revenue net of Steam commission, taxes, and refunds has already exceeded $10 million. The game recouped development budget in 2 days.
It Takes Two has sold 16 million copies since its release in 2021. Over 30 million people have played the game. Well deserved.
Unicorn Overlord has sold over half a million copies since its release on March 8. The developer's previous game, 13 Sentinels: Aegis Rim, took 3 years to reach a million copies sold. Unicorn Overlord has an 86 Metacritic score.
Jim Ryan, in a farewell visit to the PlayStation Podcast, announced that PlayStation 2 sales have exceeded 160 million units. In 2012, Sony reported 155 million units sold; production was discontinued in January 2013.
Newzoo: PC and Console Games in 2024
Market Overview
The PC and console market grew by 2.6% in 2023, reaching $93.5 billion.
The console market size reached $53.1 billion (+1.7% YoY). The PC market size grew to $40.4 billion (+3.9% YoY).
❗️Newzoo notes that the growth is quite moderate despite the large number of major releases in 2023. This is likely due to limited user time. Major buy-to-play releases diverted the audience and cannibalized GAAS projects.
Paid games accounted for 56% of revenue on PC and 57% of revenue on consoles in the US and UK markets. Microtransactions accounted for 30% (PC) and 33% (consoles); paid downloadable content accounted for 12% (PC) and 8% (consoles). The rest was attributed to subscriptions.
From 2015 to 2021, PC and console markets grew by 7.2% annually. In 2022-2023, the growth was negative, at -0.4% CAGR. However, Newzoo analysts are quite optimistic and expect the segment to grow by 2.7% annually until 2026, reaching $107.6 billion by the end of 2026.
Revenue growth is limited by the slowing growth of the audience base. On PC, the audience grew by 4% annually from 2018 to 2021, by 0.9% annually from 2021 to 2023, and is expected to grow by 1.6% from 2023 to 2026. On consoles, the audience grew by 8.9% annually from 2018 to 2021, by 3.8% from 2021 to 2023, and is expected to grow by 3% from 2023 to 2026.
Fortnite; Roblox; Minecraft; GTA V; the Call of Duty series are leaders on PC and consoles in terms of MAU (excluding Nintendo Switch). The most interesting thing here is something else. The average age of projects in the top 10 by MAU is 9.6 years on PC; 7.4 years on PlayStation; 7.2 years on Xbox; and 3.9 years on Nintendo Switch.
❗️This indicates that it is extremely difficult for new games to displace behemoths that have established themselves in the market. People still return to them.
Looking more closely at the top MAU rankings, there are ecosystems (Fortnite; Roblox); sandboxes (Minecraft; The Sims; GTA V); competitive multiplayer games (League of Legends; Counter-Strike; Valorant); annual major franchises (FIFA, Call of Duty); AAA projects (Starfield); and Nintendo exclusives are included.
Despite their age, both Roblox and Fortnite are growing in terms of MAU. Roblox is expanding to new platforms (the release on PlayStation in October 2023 led to a +54% MAU increase); Fortnite is releasing new modes and gaming experiences (the releases of Fortnite OG; LEGO Fortnite, etc., led to a 60% MAU increase in November 2023 and a 16% increase in December 2023).
How people play on PC and Consoles
Since 2021, people have been playing less on PC and consoles. The total amount of time spent on games in Q4 2023 was 26% less than in Q1 2021.
❗️Newzoo compares the figures with the peak of pandemic lockdowns. For clarity, it is better to compare with Q4 2019 figures.
66 games on PC and consoles account for 80% of all gaming time.
In 2023, games older than 5 years accounted for 61% of all gaming time on PC and consoles. Another 16% of gaming time was spent on games aged 3 to 5 years. The situation was better in 2022 and 2021.
However, in 2023, relatively new games (less than 3 years old) were able to increase their share to 23% of gaming time. This is the best result in the last 3 years.
In 2023, Fortnite (released in 2017); Roblox (2006); League of Legends (2009); Minecraft (2011); and GTA V (2013) accounted for 27% of all gaming time for users.
❗️With a high degree of probability, these users are unlikely to go anywhere - they have been living in these games for years. This should be remembered when modelling business strategies.
Of the 23% of all gaming time spent on new games in 2023, 60% came from annual franchises - Call of Duty; EA Sports FC; NBA 2K; Madden NFL; MLB: The Show. Thus, in reality, new projects only accounted for 8% of audience time.
3.5% of players' time from these 8% was spent on Diablo IV; Hogwarts Legacy; Baldur’s Gate III; Elden Ring; and Starfield. Only one of these games is GAAS.
If we consider new games (released in 2022 and earlier, and accounting for 23% of gaming time in 2023) that users spent time on in 2023, the situation is as follows - 90% of the time was spent on 48 projects. The remaining 10% was spent on more than 1400 projects.
73% of the time was spent on GAAS Pay-to-play projects (including Call of Duty, with a total of 25 such projects); 16% was spent on Premium projects (20 games); 10% - on 1400 other games; 1% - on free GAAS games (3 projects).
90% of revenue from new projects (released in 2022 and earlier) came from 43 projects. 59% came from paid GAAS projects (almost 80% of this came from annual franchises); 32% - from new paid games.
All genres, except third-person shooters (+27% YoY) and Action-RPGs (+5% YoY), lost gaming time in 2023.
Market Situation
The number of publishers in the market has been declining since 2021. In 2023, there were constantly 23 publishers in the market (+5 that appeared in ratings), which accounted for over 80% of MAU on PC and consoles.
Overall, the number of games played by users has not changed since 2021. Only the time they spend on games has decreased.
80% of the top 50 games by MAU in 2023 have franchises; the brightest representatives without franchises are The Finals, BattleBit Remastered, Ready or Not, Starfield, and Party Animals. In the top 250 games, 54% has a franchise.
Newzoo notes the success of remasters and remakes. Square Enix sold over 7 million copies of Final Fantasy VII Remake; Capcom successfully released Resident Evil 4 Remake (over 6 million copies); Konami is preparing remakes of MGS 3 and Silent Hill 2.
Remakes have a positive impact on the performance of the original game. For example, MAU in Resident Evil 4 increased by 57% after the remake was announced. It grew even more significantly after the release.
❗️However, it is worth noting that after the release of the remake, MAU of the original game dropped below the values before the remake was announced.
Newzoo analyzed 35 transmedia launches and found a positive impact on games. On average, games see a 35% increase in MAU after releasing content related to the franchise (movies, series, etc.).
Launching on mobile devices helps franchises reach new audiences. For example, in Call of Duty Mobile, the percentage of female audience is higher than on PC and consoles. And EA Sports FC Mobile managed to capture a new audience in markets where PC and consoles are not as developed.
Potential Growth Factors
Newzoo analysts note that there is a large category of players transitioning from one multiplayer game to another. The study was conducted based on Palworld; projects with 150,000 or more total MAU were compared. More intersections were found in paying users with Enshrouded, The Remnant II, Party Animals, and The Finals.
The boundaries between PC, consoles, and mobile devices are blurring. 47% of the audience plays on two systems or more.
The growth rate of the PC audience in developing markets exceeds the growth rate of the console audience by 23 times. This is likely due to economic reasons.
Developing markets show more interest in cloud gaming than developed countries. There is interest in Latin America, India, Southeast Asia - markets typically considered mobile-centric.
AppMagic: Top Mobile Games by Revenue and Downloads in March 2024
AppMagic provides revenue data net of store commissions and taxes.
Revenue
Honor of Kings earned $133.4 million in March.
In second place is MONOPOLY GO! with $117.6 million.
Significantly increasing its revenue, Honkai: Star Rail rose by 4 positions to claim the 5th spot with $82.7 million. Compared to February, the project grew by more than 50%; compared to January, it had doubled.
▫️Last War: Survival Game has entered the top-10 for the first time. The game earned $66.2 million in March. Interestingly, the game's page and creatives mimic a hyper-casual game, although in reality, it is a 4X strategy game. The game was made by the Chinese studio FirstFun, which has no successful games on Google and Apple's accounts. Pitchbook notes that the company has a stake in RiverGame, the developers of Top War.
Another newcomer in the top 10 is Legend of Mushroom (ranked 10th). In March, the game earned $54.5 million; it was launched in December 2023. 89% of the revenue comes from Japan and South Korea. The developer is the Chinese Joy Net Games.
❗️This is the first chart in several months where two new games have entered the top 10 by revenue.
Downloads
Call of Duty: Warzone Mobile ranked first in downloads in March; the project had 20.4 million installations. However, in terms of revenue, things are much worse - the game earned only $2.1 million in March.
In 4th place for downloads is Ojol The Game, which allows players to experience being a courier for the delivery service. The game was downloaded 16 million times, with 89% of downloads from Indonesia.
Another newcomer in the download rankings is Left or Right: Magic Dress up from the Vietnamese ABI Games Studio. The game had 13.7 million installations in March.
Sensor Tower: Mobile Games in 2024
Mobile Gaming Market - General Figures
In 2023, the IAP revenue of mobile games on the App Store amounted to $33.8 billion (no change from 2022); revenue on Google Play amounted to $19.2 billion (-6% YoY). Overall, the market revenue declined by 2%.
In 2023, 6.2 billion games were downloaded from the App Store (-6% YoY); on Google Play - 33.2 billion (-11% YoY). Overall, the market saw a 10% decline in downloads in 2023.
Details on Downloads and Revenue
In terms of downloads in 2023, only the racing genre saw growth (+4% YoY). The genres that experienced the least decline were strategy (-2% YoY), board games (-4% YoY), and puzzles (-6% YoY). The most significant declines were seen in Simulation games (-17% YoY), arcade games (-16% YoY), and action games (-15% YoY).
The hybrid casual segment saw the smallest decline in downloads at 2%. Hyper-casual games saw the most significant decline at 14%. Sensor Tower notes that downloads have returned to pre-pandemic levels.
❗️For casual and mid-core projects, downloads fell below 2019 levels.
The revenue situation in 2023 was slightly better. Casino games saw growth (+18% YoY - due to Monopoly GO!); puzzles (+10% YoY); sports games, action games, and board projects (all up 7% annually) grew too. The leaders of decline were shooters (-13% YoY); RPGs and strategies (-10% YoY).
The hybrid casual segment saw a 30% revenue increase in 2023; casual games saw an 8% increase. However, revenue from mid-core games dropped by 9%.
❗️I think that two factors contributed to the decline in revenue from mid-core games on mobile devices. The first is related to the large number of major releases on PC and consoles in 2023. Some of this segment audience plays on multiple platforms; time and money are limited, which leads to underspend on mobile. The second factor is the flow of money from mobile stores to payments outside the platforms. Sensor Tower simply does not see these figures. The impact of the second factor on revenue is greater.
Revenue from mobile games increased in the Middle East region (+8%); in Europe (+7%); in Latin America (+4%); and in the USA (+1%) despite declining downloads. However, revenue fell by 6% in Asia; 5% in Oceania; and 4% in Africa.
In 2023, the main markets in Latin America were Brazil (40% of the volume; -4% YoY); Mexico (28%; +20% YoY); and Chile (10%; -0.4% YoY).
In the Middle East, the main markets were Saudi Arabia (39% of the total volume; +5% YoY); UAE (24%; revenue unchanged in 2023); Israel (17%; +5% YoY); Kuwait (10%; +13% YoY).
In North America (60%) and Europe (52%), casual games dominate revenue volume. In Latin America (54%); the Middle East (53%); and Asia (79%), mid-core projects account for the majority of revenue.
Regional revenue tops differ significantly from each other. Honor of Kings was the top game in Asia; MONOPOLY GO! in the USA; Coin Master in Europe; PUBG Mobile in the Middle East; and Garena Free Fire in Latin America.
6 out of the top 10 publishers of 2023 in terms of revenue growth launched new projects. These are Scopely (MONOPOLY GO!); Century Games (Whiteout Survival); miHoYo (Honkai: Star Rail); Shivue (Chang’an Fantasy); Bytedance (Crystal of Atlan); WEMADE (Night Crows).
The most notable games of 2023
Candy Crush Saga ($960 million); MONOPOLY GO! ($830 million); Royal Match ($790 million); Coin Master ($730 million); Gardenscapes ($620 million) - the highest-earning casual games of 2023. Two new games appeared on the chart this year.
Honor of Kings ($1.9 billion); Genshin Impact ($950 million); Roblox ($880 million); Game for Peace ($800 million); and Honkai: Star Rail ($670 million) - the most notable mid-core games in terms of revenue in 2023.
❗️Not sure that Roblox should be classified as mid-core games.
The leaders of the hybrid casual direction in 2023 were Race Master 3D (110 million downloads); Stumble Guys (100 million); Magic Tiles 3 (95 million); Hill Climb Racing (90 million); and My Perfect Hotel (90 million). Two new projects made it into the top 5.
The main hyper-casual project of the year was Block Blast! (140 million downloads); Bridge Race (110 million); Going Balls (105 million); Indian Bikes Driving 3D (100 million); and Attack Hole - Black Hole Games (80 million). Three new projects entered the chart.
Marketing Trends
67% of digital advertising spending in the USA was allocated to mobile games. 28% went to PC and consoles. 4% was spent on VR projects. 1% went to other titles.
YouTube (49%), TikTok (14%), Facebook (13%), Instagram (11%), Snapchat (4%) were the main advertising channels in the USA in 2023.
Sensor Tower notes that some of the most successful creatives utilize recognizable IPs (Roblox - Lamborghini; MONOPOLY GO! - Monopoly). Influencers and user-generated content (UGC) creatives are also popular.
Retargeting campaigns were actively used by developers (Playrix, Wargaming) in 2023. In Gardenscapes, downloads in April increased by 270% YoY; revenue increased by 64%. In WoT Blitz, downloads in December 2023 increased by 75%; revenue increased by 6%.
In the USA, the majority of casual and hyper-casual gamers are women (about 60%). In mid-core projects, the split is 50/50. The main audience for mobile games is aged between 25 and 34; younger people play mid-core projects, while older individuals play casual ones.
The largest number of casual gamers in the USA is on Facebook and Pinterest; mid-core gamers are primarily on TikTok, Twitter, YouTube, and Reddit.
Key Events of 2023
MONOPOLY GO! ($153.6 million in December 2023) surpassed Honor of Kings in monthly revenue ($142 million in December 2023).
❗️There is likely a typo in the Sensor Tower chart. It probably meant November 2023.
If we shift away from MONOPOLY GO!, real-time puzzles saw growth in 2023 (a 100% increase in downloads; a 350% increase in revenue); Idle RPGs saw a 60% increase in downloads.
In 2023, major transmedia releases based on gaming IPs occurred - Super Mario Bros. Movie, The Last of Us, and Twisted Metal.
Stumble Guys actively collaborates with brands. The most successful collaboration was with Mr. Beast - daily downloads of the project tripled.
The role of Live-Ops in games is critically important. In the top-grossing projects of 2023 in the US, in the most successful cases, they increased revenue from 70% ($800 thousand - Halloween in Coin Master) to 310% ($1.5 million generated revenue - collaboration with the film Napoleon in Evony).
Netflix managed to find growth points - games from Netflix Games saw a 194% increase in downloads in 2023. The most successful release was Grand Theft Auto: San Andreas.
Genres by Competition Level
Open-world RPGs are the most concentrated subgenre. Genshin Impact accounts for 86% of the entire market share in this subgenre. Sandbox games follow with Roblox holding 82%. Finally, in the Build & Battle subgenre, Clash of Clans dominates with 81% of all revenue.
The least concentrated subgenres are MMORPGs (the largest share belongs to Justice Online - 9%); 4X-strategies (Three Kingdom Tactics leads with 8% revenue); and slots (Jackpot Party leads with 7% revenue).
However, genre concentration does not mean that successful projects cannot be developed within it. In 2022, in the Coin Looter subgenres, Coin Master had 82% of the entire market. In 2023, after the release of MONOPOLY GO!, Scopely's game took over the dominant position (47% of the subgenre's revenue).
Asian Market in 2023
Revenue fell by 6% to $26.5 billion; downloads declined by 10% to 16.4 billion.
The Chinese market grew by 1% (39% of the Asian region); Japan fell by 14% (33% of the Asian region); South Korea fell by 8% (12% of the Asian region). Other countries declined by 2% in revenue.
Mid-core projects saw a 10% revenue drop in the region (they account for 79% of all revenue). However, casual games grew by 12% (19% of all revenue); hybrid casual games increased by 20% (2% of all revenue).
In terms of downloads, hyper-casual projects declined by 14% (36% of all downloads); casual games dropped by 10% (35% of the market); hybrid casual games dropped by 3% (15% of all downloads); mid-core projects fell by 5% (14% of all downloads).
Revenue leaders were Honor of Kings, Game for Peace, Genshin Impact.
The main genres were RPGs, strategies, and shooters.
European Market in 2023
Revenue increased by 7% compared to 2022 ($7 billion); downloads declined by 12% (8 billion).
The leaders in revenue growth in 2023 were Lithuania (29%); Ukraine (27%); Turkey (25%); Poland (21%); Romania (18%).
Mid-core projects saw a 3% YoY decline in revenue (they account for 44% of all revenue). Casual projects grew by 15% YoY (52% of all revenue); hybrid casual games grew by 34% (4% of all revenue).
Hyper-casual games saw a 14% YoY decline in downloads (37% of the total volume); casual games dropped by 13% (38% of the market); mid-core games dropped by 12% (11% of all downloads); hybrid casual games dropped by 2% (14% of all downloads).
Coin Master, Candy Crush Saga, Gardenscapes - the highest-earning games in Europe. Puzzles, strategies, and casinos - the highest-earning genres.