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‘GTA VI’ Delay Slows Global Video Game Market Growth, Newzoo Report Shows

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The global video game market’s growth is projected to improve slightly in 2025, increasing by 3.4% to reach $188.9 billion, according to a report by research firm Newzoo, exclusively seen by Reuters on Tuesday. This marks a modest rise from last year’s 3.2% growth.

Industry experts had anticipated a stronger surge in 2024 driven by the anticipated launch of Take-Two Interactive’s blockbuster title Grand Theft Auto VI (GTA VI) alongside new gaming consoles. However, the game’s delay to 2026, combined with hardware price hikes caused by tariffs, has created uncertainty in consumer spending patterns.

Michiel Buijsman, Newzoo’s principal analyst, noted that the forecast accounts for factors such as hardware cycles, pricing trends, growth in installed user bases, and the slate of upcoming game releases. Despite the delay, Newzoo projects an average annual growth rate of 3.3% through 2027, down from an earlier forecast of 3.7%.

The market is expected to benefit from GTA VI’s launch in 2026 and other premium games such as Capcom’s Resident Evil Requiem. The PC release of GTA VI is also predicted to sustain growth through 2027.

Price increases for major consoles like Microsoft’s Xbox and Sony’s PlayStation have raised concerns about slowing hardware sales amid global economic uncertainty. Meanwhile, Nintendo’s Switch 2 has become the company’s fastest-selling console to date, bucking this trend.

Buijsman highlighted that Xbox sales continue to lag behind PlayStation’s previous generation, projecting moderate hardware sales ahead. Xbox recently announced its new handheld device, the Xbox Ally, developed with ASUS, which is slated for release during the 2025 holiday season.

Ubisoft Shares Plunge 20% as Game Delays Increase Cash Burn

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Ubisoft shares tumbled nearly 20% on Thursday, marking the company’s biggest single-day drop in over a decade, after the French video game maker announced it would burn more cash to extend development timelines for major titles.

In an earnings statement, CEO Yves Guillemot revealed that Ubisoft is allowing “additional development time to some of our biggest productions,” which will push the release of significant content into the next two years. The move, while aimed at improving game quality, has rattled investor confidence.

Key Financial Outlook:

  • Ubisoft now expects to break even in operating profit for the fiscal year ending March 2026.

  • Net bookings for the current fiscal year (to March 2025) fell by 20.5%, due to both delayed releases and underperformance of major titles.

  • The company aims to return to positive cash flow next year, but analysts are skeptical.

Barclays analysts had projected €96 million in free cash flow this year, but said Ubisoft’s latest guidance falls “well below” expectations. “Investors will believe in the free cash flow when it is in front of them,” the bank noted.

Game Performance and Delays:

  • The much-anticipated Assassin’s Creed: Shadows has been delayed multiple times.

  • Star Wars Outlaws, another flagship title, received a lukewarm reception.

  • Morningstar analysts expressed doubt that Shadows will be enough to turn Ubisoft’s fortunes around in 2026, given the current outlook.

To manage soaring development costs, Ubisoft has launched a joint venture with China’s Tencent, targeting the production of blockbuster franchises such as Assassin’s Creed, Far Cry, and Rainbow Six.

Despite long-term hopes pinned on these franchises, the short-term outlook remains bleak. By 08:23 GMT on Thursday, Ubisoft shares were down 19.5%, putting the company on track for its sharpest decline since 2013.