The American console market is in its worst shape in decades. According to Circana analyst Mat Piscatella’s breakdown of August sales data, the situation is the most precarious it has been since the early 1980s. Year-to-date hardware unit sales through August have collapsed 33% for Xbox and 25% for PlayStation compared to last year — an all-time US low for Xbox, and PlayStation’s weakest showing since 2013.
There is no mystery behind the drop: prices. So far in 2026, the average American buyer has paid $529 for a new Xbox console (up 26% year over year) and $597 for a new PlayStation (up 20%). Both are all-time US records. As Piscatella puts it, price sensitivity is becoming a real problem. The root cause is soaring component costs — especially memory — as chipmakers prioritize hungry AI data centers over consumer hardware. That is what drove Sony’s April price hike, which added $100 to the PS5 and $150 to the PS5 Pro, now sitting at $899.99.
August alone tells the same story. Total hardware units fell 15% year over year to 559,000 — the lowest August since 2013. PlayStation units dropped 11%, Xbox plunged 31%, and Nintendo dipped 15%. Meanwhile, the average hardware price hit an August record of $541, up from $476 a year earlier. That mismatch explains a strange twist: PlayStation 5 hardware revenue actually grew 17% in August despite selling fewer boxes, because each box now costs far more. Through it all, Nintendo’s Switch 2 led the market in both units and dollars for August and for the year to date, with the PS5 second and Xbox a distant third.
The pain extends beyond hardware. Total US video game spending fell 9% in August to $4.26 billion — a $407 million drop. Mobile was the biggest drag at -18%, and console content spending fell 7%. The bright spots were PC content, up 7%, and subscriptions, up 3%. Year to date, overall spending trails 2025’s pace by 11%, though that comparison is flattered by last year’s Switch 2 launch.
Is relief coming? Piscatella hints at one potential bright spot: the “Big Video Game” of November. He doesn’t name it, but there is little doubt he means Grand Theft Auto VI, arriving November 19. Even so, any bump depends on availability amid the RAM and component crunch — new PS5 Pro stock is already drying up ahead of the launch, and GameStop is reportedly pricing used consoles above new ones. And for now, Capcom’s Resident Evil: Requiem remains the best-selling premium game of 2026 — a throne the Big Video Game is widely expected to conquer.
Sources: Wccftech, Insider Gaming
