U.S. Tariffs Might Force Video Game Publishers To Go Fully Digital, According to Analysts
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- Tariffs enforced on goods from China and Mexico might force publishers to ditch physical games.
- The tariffs affect China and Mexico, the latter being one of the biggest manufacturers of physical video games.
- In February 2025, Sony released financial reports revealing PlayStation’s income from games are mostly from digital sales.
Analysts believe that the recent tariffs President Trump has signed will lead publishers to completely forgo physical copies. The tariffs affect products coming from China and Mexico, which are vital countries for the gaming industry.
According to Daniel Ahmad, a senior analyst at Niko Partners, China getting hit by 20% tariffs will impact the prices of video game consoles, smartphones, GPU, laptops, and most electronic devices. On the other hand, Mexico’s 25% tariff will affect the production of physical video games as plenty of video game discs are made in the country.
Because tariffs are a type of import tax, consumers will be affected. Companies may increase product prices to cover the costs, which means that the already high prices of video games might increase further.
Mat Piscatella, an analyst at Circana, thinks that the tariffs might discourage publishers from making physical copies of video games.
In February 2025, Sony released financial reports that detailed the ratio of physical to digital software sales until the third quarter of Fiscal Year 2024. The first quarter shows 80% of software sales came from digital. Second quarter was 70% while the third quarter was 74%.
