Rising prices, shrinking young audiences, and stagnant growth are pushing old rivals into unexpected cooperation.
Recent data shared by analyst Matt Piscatella through Circana’s checkout service shows that the console business is under a lot of stress. The report states that 43% of U.S. video game hardware sales now come from households with an annual income of over $100,000. This is a big jump from just 36% a few years ago.
At the same time, new buyers are going away. In the year finishing in July 2022, 10% of video game hardware sales came from people aged 18 to 24. From July 2024 to July 2025, that number dropped to 3%. People are wondering if young adults are just losing interest in console games and choosing to play games on their phones instead.
That may be partly true, but the more important problem seems to be the cost. Many young people are in college or just starting out in their careers. Prices are going up everywhere, making it harder than ever to justify a $500 console and $70 games.
The drop in sales doesn’t always mean that people in this age group aren’t interested in games anymore. There are more and more people playing PC games, but the rising costs of consoles and apps have kept young people from buying them. A lot of the time, they just can’t afford to take part.
At the same time, both Sony and Microsoft have had trouble connecting with kids and younger players. A lot of people who have been gaming their whole lives learned how to use controls by playing games like Banjo-Kazooie, Crash Bandicoot, Pokémon, or Mario. Nintendo is still great at getting kids to be loyal from the start, while Xbox and PlayStation rely more on adult, big-budget blockbusters that don’t connect with kids as well.
These problems show why Xbox and Sony are changing their plans. With gear sales staying the same, fewer young people buying games, and budgets for making games going up, both companies are under more and more pressure to get more people to play their games—the outcome: unexpected teamwork.
Recent events make this change very clear. Forza Horizon 5 came out on PlayStation, and Helldivers 2 came out on Xbox. Both companies would have kept these games exclusive to their own devices in the past. But being exclusive isn’t a good idea when you need to sell more pieces across all platforms to stay in business.
The relationship is not based on goodwill; it’s based on need. The market has forced these competitors to collaborate after years of focusing more on exclusives and longer, more expensive development processes. It’s still unclear whether this will actually make the business stronger and more inclusive for everyone, or if it will merely postpone bigger problems.
Sony and Microsoft need each other more than ever right now. The real question is whether or not the next generation of gamers will care about platforms enough to keep them going.
