Spending on physical games falls to lowest on record since 1995 — US console sales plunge 39% in July as memory costs push average price to $542

Spending on physical game disks has fallen to the lowest recorded level since tracking began in 1995, according to a new report documenting a drastic slump in the console market. U.S. console hardware sales fell 39% by unit volume in July against a year earlier, while the average price paid for a new system rose 16% to $542, according to Circana data posted by analyst Mat Piscatella on August 20.

Dollar sales came in at $282 million, down 29% and the lowest July total since 2020, with Piscatella tying the drop to console price increases caused by the RAM and component crisis, a link Circana hadn’t made in its monthly reporting before. PlayStation 5 units fell 6%, Xbox Series units fell 18%, and Switch 2 units fell 51%, with Nintendo’s own $50 price increase still to come on September 1.

PS5 dollar sales rose 29% in July even as unit sales fell 6%, a gap driven by Sony’s $100 increase across the PS5 range in April, which took the standard console to $599 and the PS5 Pro to $899. Sony still led the month in dollar sales, while the Switch 2 led in unit volume.

Switch 2 dollar sales fell 52% alongside the 51% unit decline, and the original Switch dropped 62% in units and 61% in dollars. Nintendo’s Switch 2 is the only one of the three current platforms that hasn’t raised its U.S. price yet, but that’ll change when the console goes to $499 on September 1. The company’s RAM costs for the console rose 41% late last year, and Nintendo reportedly cut planned Switch 2 output by 2 million units in March. Piscatella noted the comparison is skewed by the record-setting June 2025 launch, and that the Switch 2 is still 11% ahead of the original Switch’s time-aligned pace.

Xbox Series dollar sales fell 18%, matching its unit decline, after Microsoft raised prices on every Xbox model for the third time in two years and dropped the 2TB Series X. Xbox CEO Asha Sharma has said the company will pay five times more for memory and storage in 2027 than it did two years earlier. Taken together, the July numbers work out to roughly 520,000 consoles sold across all platforms, against around 850,000 a year earlier, based on Circana’s dollar totals and average selling prices.

As for physical game discs, spending fell to $85 million in July, the lowest July figure Circana has recorded since tracking began in 1995, according to the firm’s full report as cited by Kotaku. Nintendo platforms account for 63% of U.S. physical game spending so far in 2026 and PlayStation for 32%, leaving Xbox a little over 4% once PC collector’s editions are stripped out. Sony has already committed to ending disc production for new PlayStation games in January 2028.

Microsoft stopped sharing digital sales data with Circana as of the July report, Piscatella confirmed, and EA also left the firm’s digital panel around the time it went private. That means Circana now estimates rather than measures digital sales for Xbox, Activision, and Bethesda titles, including Call of Duty: Black Ops II, which topped July’s chart on its new PS4 and PS5 port. Total U.S. video game spending across content, hardware, and accessories fell 10% to $4.5 billion in July.