The U.S. game industry had a very rough April, as sales plummeted 26% while the Wii sold just 277,000 units. While the first few months of the year saw the Wii impacted by supply issues, that situation has improved somewhat, and Nintendo recently launched a new black Wii bundle, packing in Wii MotionPlus, Wii Sports and Wii Sports Resort.
Wedbush Morgan analyst Michael Pachter believes this new bundle will finally push Wii sales back up in May, but he also noted that the Wii's software attach rate continues to get worse.
"May saw the introduction of the new Wii bundle, which should drive Wii unit sales back to the 400,000 level," he said. "However, this new bundle contains two software titles (Wii Sports and Wii Sports Resort), leading us to believe that the software attach rate for the Wii may decline further from its already very low level. We expect to see some increased supply for Wii Fit and Wii Play, and are hopeful that these titles make up for any declines due to the bundle."
Overall, Pachter expects May to be a solid month for the industry, but not as explosive as he originally thought, given the weaker trends exhibited in April. "The May lineup is quite impressive, but two of the big games (Alan Wake and Super Mario Galaxy 2) are on only one platform, limiting the potential for huge sales. The April results continue to concern us, as the weak April trend most likely carried into early May, suggesting that growth could be bracketed at lower levels than we originally thought. Should that be the case, we expect May software sales to be up only 15 – 30%," he explained.
