Circana: US game console spending fell 27% in November to $695M, the lowest in the pivotal month for holiday shopping since 2005, after a tough year for makers
US spending on video game consoles fell 27% last month, marking the worst November in two decades as tariffs and rising component costs pushed prices to record highs.
Context & Ripple Effects
The November drop extends a weak backdrop for dedicated gaming hardware: global PC-and-console spending had already declined in 2024, with console revenue down, according to Newzoo's 2024 market reading.
The slump was uneven across platforms. Subsequent Circana data showed [[a:893817|a far steeper November decline for Xbox Series than for PlayStation 5 or the combined Switch lineup]], making the aggregate spending figure especially consequential for the weakest hardware seller.
First-order effects
- US console makers and retailers enter the holiday period with $695M in November hardware spending, reducing near-term sell-through and revenue relative to a key shopping month.
- Higher console prices tied to tariffs and component costs directly constrain purchases, particularly where consumers can defer a hardware upgrade.
Second-order effects
- The divergent platform results increase pressure on lagging console vendors to improve their value proposition through pricing, bundles, or software access; the data does not establish which response will prevail.
- Retailers and hardware partners may have to recalibrate inventory and promotions toward the platforms still converting demand, as later data showed Switch 2 leading US hardware sales for December and 2025.
Third-order effects
- If elevated hardware prices persist, console growth may depend more heavily on launch-cycle demand and differentiated content than on broad holiday upgrades, raising the cost of maintaining platform-exclusive ecosystems.
- The pattern points to a more polarized hardware market, in which a leading platform can offset rivals' declines while weaker installed-base growth makes third-party and cross-platform distribution more economically important.
The trend: Rising console prices are testing the traditional holiday hardware-upgrade cycle and widening the gap between resilient platforms and struggling rivals.