Consoles are more expensive than ever, and fewer people are buying them

The US console market is experiencing a slowdown, with fewer consumers purchasing hardware and more expensive consoles making it harder to attract buyers. In August 2026, 559,000 consoles were sold, a 15% decrease from the same period last year and the lowest August total since 2013, according to Circana's Mat Piscatella. The average selling price for consoles rose from $476 in 2025 to $541 in 2026.

Higher-end models helped offset the decline in sales for manufacturers like Sony, whose PlayStation hardware revenue increased 17% year-over-year, despite a 11% drop in unit sales. However, these higher-tier models also highlight the limits of mid-generation upgrades, as they generate additional revenue without expanding the audience for the hardware.

Console prices are at historical highs due to component cost pressures and the introduction of premium models, such as the $900 PS5 Pro. This leaves consumers facing a higher cost of entry compared to previous console cycles. The slowdown is evident across all major manufacturers, with Xbox unit sales falling 31% year-over-year and reaching their lowest August level since 2020, while Nintendo's sales declined 15% from August 2025.

The average price paid for a new Xbox console in 2026 YTD is $529, a 26% increase from the previous year, while PlayStation consoles averaged $597, a 20% increase. These price increases occurred despite the consoles being six years into their generation, and market saturation likely contributing to weaker demand. The PS5 and Xbox Series X|S have also faced a rush to buy before price hikes, reducing the pool of potential summer buyers.

While Sony's revenue growth indicates that selling more expensive models can benefit a manufacturer, it does not necessarily reflect broader growth in console ownership. The comparison with August 2013, when US console sales totaled 423,000 units, shows that buyers were preparing for the upcoming PS4 and Xbox One releases. This time, no successor hardware has been announced, and the current slowdown is occurring without an announced generation of replacement consoles on the horizon.

Year-to-date spending on physical games increased by 5% to $738 million, while traditional physical formats, including discs and cartridges, saw a 3% decline. However, spending on Game-Key Cards increased by a remarkable 631%, bringing the physical software category into positive territory. Despite this, traditional physical media continues to lose ground as players shift towards digital storefronts.

The release of the Switch 2 also affected August sales rankings, with Elden Ring rising to seventh place and NBA 2K27 and Madden NFL 27 ranking third and second, respectively. Across the broader games market, content spending fell by 10% year-over-year to $3.8 billion, with a 2% decrease year-to-date. Mobile spending dropped by 18%, the largest decline among the reported platforms, while PC gaming spending increased by 13%.

Subscription purchases also grew by 3%. The PC platform's growth stands out in a month when both console hardware purchases and overall content spending declined.