Xbox 360 Outsold Wii in September, predicts Pachter

October 15, 2007 | By: James Brightman

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According to Wedbush Morgan Securities analyst Michael Pachter, September was all about the Xbox 360 and Halo 3. He believes the Xbox 360 outsold the Wii by 25,000 units. He also thinks the Wii was supply constrained.

With the NPD data for September expected by the close of market this Thursday, Wedbush Morgan Securities' Michael Pachter has issued his own video game sales preview report, which predicts a whopping 47 percent increase in software sales and a top spot in hardware sales for Microsoft's console.

Thanks in very large part to the blockbuster success of Halo 3, Pachter is estimating software sales of $655 million for the month, compared to last year's $445 million. Halo 3 likely accounted for over $200 million (3 million unit sales) of the total during NPD's reporting period, he said.

While prediction market the simExchange forecast Wii to outsell Xbox 360 (485K vs. 423K) despite Halo 3, Pachter thinks that Master Chief will carry Microsoft over the top. He's forecast Xbox 360 sales of 450K, Wii sales of 425K and PS3 sales of 150K.

Pachter also predicts the DS to have sold 430K, with the PSP coming in at 252K thanks to the introduction of the new PSP slim model. Regarding Nintendo's platforms he said, "Our forecasts for the Wii and the DS reflect our belief that supplies remain somewhat constrained, particularly for the Wii."

Beyond Halo 3, other top drivers of sales during September likely included Nintendo's The Legend of Zelda: Phantom Hourglass (DS), Sony's Heavenly Sword (PS3), Midway's Stranglehold (360, PC), and continued strong sales of Electronic Arts' Madden NFL 08, Nintendo's Wii Play and Metroid Prime 3: Corruption, and Activision's Guitar Hero.

Interestingly, the fact that Halo 3 launched in September could have even better implications for the real holiday shopping season, according to Pachter. "Although we think that sales of Halo 3 accounted for virtually all of the growth during the month, we think that the game drove hardware sales and positions the industry for even greater sales in November and December, when many Halo players will be ready for a new challenge," he explained.

Going forward, 2007 should finish quite strong. "[Software] sales growth over the last 12 months was a robust 16%, with last month up 22%. Although comparisons remain difficult through the holidays, we expect continued strong (+10% or greater) sales growth for the rest of the year. Should Sony introduce a $399 PS3 in the next few weeks, we expect hardware sales to drive software sales to at least this level," Pachter said.

Lazard Capital Markets recently forecast a software sales increase of 30 percent for September.