Global gaming market will rebound to $250 billion in 2025

Despite facing significant economic headwinds, the global gaming market is showing early signs of a return to growth, with projections indicating it will reach $250.2 billion by 2025, according to Aldora’s latest report. In the near term, however, this growth is modest, with the market expected to expand by just 0.6% year-over-year in 2024. Beneath this surface-level growth, there are substantial shifts occurring across various segments of the industry, each with its own set of challenges and opportunities.

Mobile gaming remains the dominant force in the gaming industry, with revenue expected to reach $109.6 billion in 2024, representing a 3.6% year-over-year increase. This segment’s growth is particularly notable given the challenges it faces, including market saturation and rising user acquisition costs. Yet, mobile gaming continues to innovate, demonstrating its resilience and solidifying its position as a cornerstone of the gaming ecosystem. By 2025, mobile gaming revenue is projected to hit $116 billion, underscoring the segment’s enduring appeal. A recent report from Apptica reveals that the mobile gaming market saw over 30 billion installs in the first half of 2024, reflecting a 5.8% growth compared to the second half of 2023.

The console gaming segment is grappling with the end of the current hardware generation, leading to a significant 31% decline in hardware sales anticipated for 2024. However, this decline is partially offset by robust software sales, which are expected to drive the segment’s total revenue to $44.9 billion, marking a 3.1% year-over-year growth. As the industry transitions to the next generation of consoles, the segment is predicted to continue experiencing a decline in 2025, albeit at a slower rate of -11% year-over-year, before gradually moving toward recovery.

PC gaming is emerging as the fastest-growing segment within the gaming industry, with expected growth rates of 4.2% in 2024 and an even more impressive 8.1% in 2025. Consumer spending in this segment is set to reach $31.4 billion in 2024, highlighting the platform’s enduring popularity and ability to adapt to changing market dynamics. This momentum reflects PC gaming’s unique position as a versatile platform that continues to attract a dedicated user base.

Virtual reality (VR) stands out as a bright spot in the gaming industry, with consumer spending in this segment expected to grow by 8.9% in 2024, reaching $3.8 billion by 2025. This growth is fueled by significant investments from major tech companies and the excitement surrounding upcoming product launches, such as Apple’s Vision Pro. VR’s expansion highlights the growing interest in immersive experiences and the potential for new gaming frontiers.

While the popularity of esports and live-streaming remains high, these platforms are struggling with profitability. Esports revenue is projected to decline by 3% in 2024 to $173 million, with a further dip of 8.3% expected in 2025. These challenges underscore the need for the industry to develop new monetization strategies and strengthen its advertising marketplace to achieve sustainable growth.

The rise of transmedia strategies is becoming increasingly prominent as major entertainment companies adopt cross-platform approaches, leveraging intellectual property (IP) across various media to create interconnected experiences. This trend is reshaping the boundaries between gaming and other forms of entertainment, opening up new avenues for engagement and revenue generation. By blurring these lines, companies can maximize the potential of their IP and offer consumers more immersive and cohesive experiences.

Non-endemic brands are making significant inroads into the gaming industry, with companies like Mattel and Walmart finding success through activations on platforms such as Roblox. This trend highlights the growing importance of gaming as a marketing channel and a platform for immersive brand experiences. As more non-gaming brands enter the space, the gaming ecosystem is likely to expand, offering new opportunities for collaboration and innovation.

In response to ongoing challenges, companies across the gaming industry are increasingly focusing on efficiency and strategic consolidation to improve profitability. This shift is expected to lead to a wave of mergers, acquisitions, and partnerships in the coming year, as companies seek to strengthen their market positions and capitalize on emerging opportunities.