In 2022 nearly 3.2 billion people worldwide chose to engage in a video game, a 2.9 billion person rise from 2020. This would lead agencies tracking revenue to assume video game profits were on the rise, but despite the growth in the average number of players, the gaming industry made less in 2022 than it has in previous years according to a 2022 Global Games Market Report.
Both 2020 and 2021 saw record levels of video game engagement as well as record levels of spending surrounding the video game industry. It also brought many players back to the hobby after long absences, as people sought ways to kill time during the pandemic's quarantine phase. The majority of the industry's 2020 profits were digital, as pandemic induced lock-downs prevented people from physically visiting retail outlets.
Despite this growth during the pandemic, gaming revenues worldwide are down by 4.3% to $184.4 billion dollars. However, some think this is simply a correction back to normal revenue levels, as the steep rise in video game spending spawned by the pandemic has started to wane. Video game spending was at an all-time high in 2020 as the pandemic peaked.
In 2022, the majority of gamers are in the Asia-Pacific region, which spends roughly 87 billion yearly on gaming and makes up 48% of the market. Second is North America, spending 48.4 billion and cornering 24% of overall yearly spending. This is down across the globe on both the PC gaming front and among console gamers, especially since 2020 saw video game console spending alone soar over 50 billion annually.
Revenue only rose among one demographic in 2022, and that was in Latin America and in the Middle East/Africa. Gaming's annual profits depend largely on mobile gaming which accounts for about 50% of spending, and web browser based gaming makes up a mere 2.3 billion dollars of annual revenue. Games like Call of Duty Mobile were famous for pulling in mass amounts of revenue during the pandemic, and mobile titles often generate profit with a pay to win strategy that forces gamers to keep shelling out real money in order to advance.
The Global Games Market Report suggests that gaming is recession proof given how well the industry performed during the pandemic, and how well it continues to perform given financial instability all over the world in 2022. They expect gaming's annual revenue to hit 225 billion by 2025, meaning that the 4.3% downturn currently reported isn't even a setback for the industry as a whole. Given that gaming revenues were 43 billion dollars higher than anticipated between 2020-2021, it's quite likely markets are simply stabilizing as more people return to normal life following the pandemic.
Source: New Zoo 2022 Global Games Market Report (via PC Mag)