As tariff increases continue to affect a wide range of consumer goods, the video game sector appears somewhat insulated, particularly in the area of digital distribution. Digital video games do not require materials, shipping, or manufacturing, allowing them to avoid many of the costs typically associated with tariffs. This structural difference has positioned digital games to remain largely unaffected by the recent economic changes, at least in terms of direct pricing.

Tariffs x Gaming

The shift toward digital formats in the gaming industry predates current tariff discussions, with PC gaming already predominantly digital. In an interview with FastCompany, Manu Rosier, market intelligence director at Newzoo, emphasizes that digital gaming's dominance means that tariffs are not expected to significantly impact the price of video game software.

How Tariffs Could Change the Players Buy Games

Shifts in Consumer Spending Behavior

While digital games may not experience direct price hikes, the broader economic impact of tariffs could still influence how Americans spend money on games. According to Mat Piscatella, executive games director at Circana, the effect of tariffs on everyday essentials like groceries and housing could limit discretionary spending, including entertainment expenses. This pressure may lead more consumers to gravitate toward free-to-play games or cheaper alternatives rather than investing in premium titles. Piscatella suggests that consumers might prefer spending smaller amounts on microtransactions within games they already enjoy, rather than committing to the higher upfront cost of new releases.

The Growing Role of Microtransactions

The growing reliance on microtransactions within the gaming industry could be further amplified by changes in consumer behavior. According to Newzoo’s 2025 PC and Console Gaming Report, 58% of all PC gaming revenue in 2024 came from microtransactions, reflecting a slight but steady increase from the previous year. Piscatella notes that spending $5 or $20 on a familiar title is often seen as more manageable than paying $80 for a new game. Well-established games such as Fortnite, Minecraft, Roblox, Grand Theft Auto, and Call of Duty are expected to benefit from this trend, as they offer ongoing content and social engagement that encourage repeated spending.

Projected USA Total Market Spend March 2024-2025

Impact on Physical Games and Hardware

While digital games may continue to thrive, the market for physical games and gaming hardware faces more significant challenges. The introduction of tariffs is likely to affect hardware and packaged games, areas where companies like Nintendo have traditionally maintained a strong presence. Nintendo’s decision to delay the launch of the Switch 2 in the United States highlights concerns about the viability of physical distribution models under current economic conditions. Piscatella points out that Nintendo, with its emphasis on physical cartridges for easy sharing among family members, may need to reconsider production and distribution strategies in response to these new challenges. Rosier adds that tariffs could make packaged games more expensive than their digital counterparts, possibly accelerating the industry's gradual shift toward digital distribution.

Projected USA Total Market Spend March 2025

The Uncertain Future of Video Game Spending

Despite these potential shifts, making definitive predictions about the future remains difficult due to the rapidly changing economic environment. Piscatella underscores the high level of uncertainty, noting that while Americans will continue to enjoy video games, the ways in which they play and spend money on them could evolve significantly. The video game industry, which saw peak audience growth during the COVID-19 pandemic, has since shifted its focus from expanding its user base to maintaining and increasing engagement among existing players. How tariffs will ultimately shape spending habits and consumer preferences remains an open question, but industry experts agree that adaptation will be necessary.