US market researchers at Circana are forecasting a "transformative year" for video games in 2026. While GTA 6, Switch 2 and subscriptions are expected to generate momentum, challenges are also anticipated, particularly with regard to hardware, macroeconomics and shifts in consumer behaviour.
Following a year of slight growth, the U.S. video game industry enters 2026 with the potential to reach a new record high in consumer spending. According to Circana's latest Games Market Dynamics report, total U.S. consumer spending on video game hardware, content and accessories reached $60.7 billion in 2025 (+1.4%, 2024). Circana projects that spending in the U.S. video game industry will rise by 3% to reach $62.8 billion in 2026, surpassing the current all-time high of $61.7 billion (2021). This growth is expected to be fuelled by the second year of the Nintendo Switch 2 console, anticipation for the release of Grand Theft Auto VI, and the continued popularity of subscription-based content.
"The 2026 U.S. video game market brings great opportunity - and risk," said Mat Piscatella, video games industry advisor at Circana. "While overall hardware faces headwinds, a stellar slate of software and strong subscription engagement suggests a particularly exciting year. Hold on - 2026 could prove to be one heck of a ride."
The Nintendo Switch 2 became the fastest-selling home console in US history after just seven months on the market. Circana expects its momentum to accelerate in 2026, thanks in part to the ongoing strength of Nintendo’s franchises. Scheduled for launch in November, GTA VI has the highest purchase intent ever recorded in Circana's tracking history, alongside other highly anticipated releases including Resident Evil: Requiem, Pokémon: Pokopia, and Marvel's Wolverine. The market researchers also expect subscription spending to remain strong as consumers seek value and access to extensive game libraries. They also view Valve's upcoming Steam Machines as a potential disruptor of the console market if they are competitively priced and widely available.
Conversely, headwinds may arise from rising hardware costs (RAM, GPUs, CPUs and storage), driven by demand for AI data centres, and constraints in hardware availability. According to Circana, there are also macroeconomic challenges: "When considering potential cost increases due to tariffs and/or other factors, more than one-third of consumers would purchase fewer full-price games at launch (38%) or would wait longer for video games to be on sale (34%), according to the latest findings from Circana’s Future of™ Video Games report. Furthermore, 27% would spend more time playing free-to-play games."
"Consumer Behavior Shifts: Younger players are shifting more heavily toward PC and mobile, where top titles like Roblox, Minecraft, and Fortnite dominate. If hardware becomes cost-prohibitive, expect increased play on existing devices, growth in PC and mobile gaming, and accelerated adoption of cloud gaming." - Circana
