Data from the first quarter of the year in the gaming world points to a transformation that must be closely monitored for the long-term sustainability of the industry. The significant decline in video game spending, particularly among 18-24 year-olds, raises serious questions about the future of the gaming industry.

Young people’s spending on games has decreased

According to data released by market research firm Circana, overall consumption spending in this age group decreased by 13 percent compared to the same period last year, while spending on video games decreased by 25 percent.

This young generation, belonging to Generation Z, still allocates a significant budget to the entertainment industry, but the share of video games within this budget is shrinking year by year. This is where the most critical data for the industry emerges.

This is because young gamers are not giving up gaming; they are simply shifting to different consumption models. Free-to-play games or low-cost options are increasingly preferred by young users. However, AAA games, which cost as much as $70 to $80, have become difficult to access for this segment.

This significant decline in spending by young gamers differs from the industry average. While the decline in gaming spending in other age groups remains around 5 percent, the 25 percent decrease in the 18-24 age group signals a structural shift in the industry.

Considering that this age group also accounts for approximately 28 percent of the gaming audience, the picture becomes clearer. This young audience, which continues to play games, is now beginning to fall outside the revenue stream targeted by content creators.

It’s clear that economic conditions are also driving this trend. Rising costs of living, income inequality, and economic constraints such as being a student or early career are causing young people to be more selective in their spending choices.

However, a more critical issue for the industry is that while young people still have budgets for entertainment, they are shifting this budget to areas other than video games. For game studios, this poses not only a temporary spending decline but also a risk of a permanent shift in consumer behavior.