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Analysts: Madden Delay To Cause Big Drop In August NPD Report

Game industry analysts are expecting tomorrow's monthly NPD report on new retail sales to show steep drops from last year's performance, thanks in large part to the later-than-usual launch of EA's annual Madden title.
Game industry analysts are expecting tomorrow's monthly NPD report on new retail sales to show steep drops from last year's performance, thank in large part to the later-than-usual launch of EA's annual Madden title. While the industry's August sales are usually buoyed by a mid-month launch of Madden -- invariably one of the top sellers for the year -- the NFL lockout threat delayed this year's launch to August 30, past the end of the NPD reporting period on August 27. This fact, combined with a generally weak slate of August releases, leads Sterne Agee analyst Arvind Bhatia to predict August software sales will be down 30 to 35 percent compared to last year's mark of $404 million. Wedbush Morgan analyst Michael Pachter echoes the concern, projecting a 30 percent drop. Both analysts expect the situation to turn around quickly, however, with Madden's late release aided by the launch of Microsoft's Gears of War 3 in September. October's launch of EA's Battlefield 3 will help kick off a strong fourth quarter packed with highly anticipated title, the analysts said. But holiday season strength may not be enough to completely compensate for what has been a weak year for the industry overall. "We continue to think that negative year-over-year sales will weigh on investor confidence in the video games sector until industry sales begin to grow on a sustained basis," Pachter warned. As far as hardware is concerned, both Bhatia and Pachter expect year-over-year declines for the Xbox 360, Wii and DS in August sales, only partially offset by price cut-driven monthly increases in 3DS and PS3 sales.

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