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Physical games will not exist in ‘less than a decade’ predicts analyst

Published June 26, 2026 · Updated June 26, 2026 · By Mary Martin

Physical games may disappear within a decade, analyst warns

Physical games will not exist in less - Analyst Mat Piscatella from Circana has issued a bold forecast, suggesting that physical game sales could vanish within a decade, even as a slight rise in US markets recently challenged this narrative. The shift toward digital platforms has already begun to erode the traditional retail landscape, with physical game formats facing a quiet but steady decline.

A troubled path for boxed games

With the closure of physical retailers and the growing dominance of digital distribution, the viability of physical game sales has come under scrutiny. The announcement of GTA 6’s launch with only download codes, rather than physical discs, has underscored this trend. While rumors of a disc edition persist, the decision by Rockstar to skip a physical release signals a broader industry movement away from tangible media.

"The bulk of game sales now occur through digital platforms," Piscatella wrote on Bluesky. "The second-hand market… doesn’t really matter."

Piscatella’s analysis is grounded in data showing a consistent erosion of physical game spending since 2009. A graph shared on Bluesky illustrates US sales figures from 2007 to 2026, revealing a steep drop over the years. By 2025, the record low in physical game spending highlighted the growing irrelevance of physical copies in a rapidly evolving market.

Yet, this year marked a rare reversal in the trend, as physical game sales rose by 3% compared to the prior year, totaling $1.6 billion (£1.2 billion). The analyst attributes this temporary uptick to the emergence of the Nintendo Switch 2, whose consumer base has historically shown a stronger preference for physical editions. However, this growth may be fleeting, given the broader forces at play in the industry.

Console evolution and the future of physical media

The future of physical games hinges on how Sony and Microsoft approach their next-gen consoles. If these companies continue to favor digital-only options, the decline of physical media could accelerate. The current memory shortages have driven up hardware costs, potentially making digital versions more appealing to consumers. But even with rising prices, the role of physical games might be redefined in the coming years.

Piscatella argues that the absence of physical drives in over half of all US Xbox Series consoles and a similar proportion of PlayStation 5 units underscores the industry’s shift. These figures suggest that the next generation of consoles may further marginalize physical media, especially if they prioritize digital storage over optical discs. However, the analyst acknowledges that physical games could still hold value in niche markets.

"More than half of all Xbox Series consoles in the US don’t have a physical drive, while over a quarter of PlayStation 5’s are the same," Piscatella stated. "We likely have less than a decade left of physical software."

While the analyst’s prediction may seem dire, the recent increase in physical game sales raises questions. Is this a sign of a broader resurgence, or merely a temporary anomaly? Piscatella suggests that the growing demand for physical copies could be influenced by factors such as collector enthusiasm or the unique appeal of tangible media for certain audiences. However, the overall trajectory remains downward.

Physical game collectors, often passionate about limited editions and boxed releases, may view this as a chance to rally against the digital tide. Yet Piscatella dismisses such optimism, emphasizing that the majority of game sales now rely on digital distribution. For many consumers, the convenience of instant access and lower costs of digital versions outweighs the sentimental value of physical media.

The role of consumer behavior in shaping the market

Analysts like Piscatella point to changing consumer habits as the primary driver of this transition. The rise of streaming services, cloud gaming, and mobile platforms has further diminished the need for physical copies. Additionally, the growing trend of second-hand market transactions has made physical games more disposable, reducing their long-term appeal.

Despite these challenges, physical games remain a cultural touchstone for some. The success of specialty retailers like iam8bit and Limited Run demonstrates that a dedicated community still values boxed games. However, these stores represent a shrinking segment of the market, and their survival may depend on maintaining a loyal fanbase rather than mainstream demand.

The analyst’s warning is not without precedent. Over the past decade, physical game sales have consistently declined, with 2025 marking the lowest point. While the recent 3% increase in US sales is noteworthy, it may not reverse the long-term trend. Instead, it serves as a brief pause in an otherwise inevitable shift toward digital formats.

As the industry moves forward, the fate of physical games will likely be determined by how console manufacturers and developers adapt. The upcoming Nintendo Switch 2, for instance, could play a pivotal role in sustaining interest in physical media. However, if Sony and Microsoft follow suit by offering only digital SKUs, the decline of physical games could become unstoppable.

Ultimately, the analyst’s forecast paints a picture of a future where physical games are relegated to a niche market. While this may seem unlikely to some, the evidence points to a reality where digital dominance is the norm. The next few years will be critical in determining whether physical media can hold its ground or if it will fade into obscurity within a decade.

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Looking ahead: A digital-first era

The data supports the idea that physical games are in decline, but their survival is not guaranteed. As technology advances and storage becomes more efficient, the need for physical media will diminish. The analyst’s warning serves as a reminder that the gaming industry is on the brink of a transformation, one that may leave physical formats as a relic of the past.

While some may cling to the idea of physical games as a counter to digital convenience, the numbers tell a different story. The transition to digital is not just a trend—it is a fundamental shift in how games are bought, sold, and experienced. As the industry moves forward, the question remains: will physical games be remembered as a cherished tradition, or will they be forgotten in the age of instant access?

For now, the 3% increase in US physical game sales offers a glimmer of hope. Yet it is a small victory in an increasingly digital-first world. The analyst’s prediction may be correct, but the journey toward that reality is far from over. As consumers continue to embrace digital platforms, the future of physical games will be shaped by the choices of both manufacturers and players alike.