We all knew game hardware spending would drop, but the July percentages are still shocking
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Considering how every console and piece of hardware under the sun is now significantly more expensive due to AI-induced shortages, I am not at all surprised that people are buying them less. However, I never could have anticipated that things are going to drop so severely and so fast, but, alas, this is where we’re at now.
According to Circana’s Mat Piscatella, this July saw a dramatic decline in hardware purchases compared to the same period last year, with total hardware unit sales going down by 39 percent overall. With prices 16 percent higher than before, this ends up being a 29 percent total decrease in expenditure.
When individual consoles are looked at, PlayStation 5 saw the smallest decline at just six percent, while Xbox dropped by 18 percent. The worst performer, however, was the Nintendo Switch 2, which saw a sales decline of a whopping 51 percent between two Julies.
Hardware – July video game hardware spending fell 29% when compared to a year ago, to $282 million, the lowest total for a July month since 2020 ($163 million).
— Mat Piscatella (@matpiscatella.bsky.social) 2026-08-20T13:05:47.462Z
Nevertheless, the Switch 2 remains the best-selling console when total units are taken into account, and as Piscatella explains, it’s well on track to surpass the all-time figures of the original console. That alone should tell you just how little both PlayStation 5 and the Xbox are selling in raw numbers, even if their profits, due to significantly higher pricing, tend to indicate otherwise.
AI-induced hardware woes, primarily due to that technology hogging all the memory for itself, have started impacting pricing on basically any product out there that contains digital components. From your phone to your smart fridge to even a modern calculator, everything is getting more expensive, all so you could watch slop videos of Will Smith eating spaghetti in more elaborate ways.
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