Madden 25 year-over-year decline reflects transition year, says analyst
Madden 25's year-over-year decline in sales reflect a "softness" during a console transition year, according to an industry note from Robert W. Baird & Co. analyst Colin Sebastian.
Yesterday, Electronic Arts announced that according to internal estimates, first week sell-through of Madden NFL 25 came to over one million units. The figure is a decline compared to the 1.65 million units sold the prior year.
Along with it being a console transition year, Sebastian noted that other factors also contributed to the decline: a higher ASP (ex. $100 anniversary edition selling on Amazon.com); strong digital sales (record Ultimate Team revenues); and "likely some delays in retail purchases due to the upcoming hardware refresh."
However, with the NFL season starting this week, the analyst expects the football season will help "drive interest and retail sell-through."
"With both NCAA and Madden now demonstrating declining sales over the summer, we continue to expect soft sell-through trends for all but the most popular video game franchises," he said. "As such, Madden issues should not imply any weakness in sales for Take Two's upcoming GTA 5 or EA's Battlefield, in our view. For GameStop, our checks suggest Madden issues were not as severe at specialty retailer.
"While Madden sales are another 'yellow flag,' at this point we would use sector weakness as a buying opportunity ahead of stronger sales trends likely beginning later this month."
Sebastian also expects FIFA 14 to have a strong launch compared with Madden 25's.
"Importantly, the September launch of FIFA 14 is a more important driver of revenues and profits, and we expect this global franchise to sell roughly in line with last year quantities, as fans gear up for the upcoming World Cup year," he said.
"For context, we expect roughly three-times the unit sales of FIFA 14 versus Madden 25 in the quarter, with units each contributing roughly 35% and 10-15% to fiscal Q2 revenues, respectively."