Industry tracker NPD released console hardware & software totals for the 5-week period ending March 5, 2007 after the close yesterday. While sales of the next-gen consoles were below industry expectations, there were some known supply issues with the Wii during the month, which dampened sales to about 260,000 for the period, and allowed the hardware winner for the month to be, that’s right, the PS2. Total hardware figures are as follows:
Nintendo DS 508,000
PlayStation 2 280,000
Wii 259,000
Xbox 360 199,000
PlayStation Portable 180,000
Game Boy Advance 148,000
PlayStation 3 130,000
GameCube 22,000
The handheld DS crushed its estimates, which called for anywhere from 250k to 400k.
With the March numbers in tow, here’s where the U.S. installed base currently stands:
Wii 2.1 million
Xbox 360 5.3 million
PS3 1.2 million
It is very likely that someone got their hands on the NPD data a little early, as evidenced by the chart for Electronic Arts (ERTS) yesterday; as of 1:45 Eastern, shares were set to trade about 2.9 million for the day, a little less than the 3-month average of 3.5 million. But in the last 2 ½ hours of trading, ERTS shares dropped 3.25% on a huge spike in volume, as over 5.5 million changed hands (and 7.4 million on the day). No news, just someone who was adamant on getting out of the stock as fast as possible.
Electronic Arts is known to be weak in their current Wii offering, and really needs the PS3 to start surprising on the upside with its sales figures.
Another concern for the software publishers with regards to the Wii relates to the upgrade cycle, which some feel will happen to the Wii first. By all accounts the Wii is a breakthrough iteration in the console landscape, Nintendo may already be working on an improved version to leverage their interface technology. PS3 and Xbox 360 will likely have some longer legs; one need look no farther than the continuing PS2 success for evidence of this.
Despite the action in ERTS shares, total software sales were very strong, as NPD reported $574 million for the March period, a 15% rise year-over-year and well ahead of estimates for $510 – $520 million. Sony’s (SNE) God of War II title for the PS2 was the biggest seller during the period, with 833,000 copies shipped. There are enough titles for the PS2 being released during the summer to likely keep sales figures strong – and ahead of the PS3, which is in desperate need of a haircut to its $600 price.
The upside surprise should bode well for retailer Gamestop (GME), which has been running since they upped guidance at the end of March. GME shares are currently up 1.88% to $33.64 as of 12:00 EST.
Ryan Barnes
April 20, 2007
Ryan Barnes can be reached at [email protected]; he does not own securities in the companies he covers.
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