What's Happening?
According to the latest State of Video Gaming report by Epyllion, global video game content sales increased by 5.3% to reach $195.6 billion in 2025. Despite this growth, the industry faced a significant decline in private funding, which fell by 55%. The report highlights a trend of increasing reliance on outsourcing for core creative work, with 35.5% of developers' total content investment going to external partners. This shift is attributed to the need for flexible skillsets and the ability to produce more content. The report also notes a decrease in layoffs compared to previous years, although the total number of job losses over four years remains substantial. Consumer spending on video game content for consoles and PCs showed varied growth, with significant contributions
from platform services like PlayStation Plus and Xbox Game Pass.
Why It's Important?
The growth in video game content sales underscores the industry's resilience and adaptability in a rapidly changing market. However, the decline in private funding suggests potential challenges in sustaining innovation and development. The increased reliance on outsourcing reflects a strategic shift to manage costs and access specialized skills, which could impact job opportunities within the industry. The report's findings on consumer spending highlight the importance of subscription services in driving revenue growth, indicating a shift in consumer preferences towards more flexible and accessible gaming experiences. This trend could influence future business models and investment strategies within the gaming sector.
What's Next?
Looking ahead, the report suggests that the video game industry will focus on non-core markets, advertising, direct-to-consumer channels, and external development as key areas for revenue growth in 2026. The continued expansion of platforms like Roblox, which has become a major driver of market growth, indicates a potential shift towards more interactive and community-driven gaming experiences. As the industry navigates these changes, companies may need to adapt their strategies to remain competitive and capitalize on emerging opportunities.
