The gaming industry learns to adapt to Gen Z

For years, Gen Zers have been considered the fuel that drives the gaming industry. They are the first to embrace new trends, live in virtual worlds, and spend large sums on games, expansions, skins, and subscriptions. But new research from Circana, first published in June, reveals a different reality: young people are reducing expenses at a rapid pace, and the gap between them and older generations is widening.

According to Circana data, published in the Wall Street Journal, the reduction in spending by Gen Zers is not a one-off phenomenon but part of a broader trend. Between January and April 2025, total spending by 18- to 24-year-olds across all consumption categories fell by 13% compared to the previous year, and gaming saw a particularly sharp decline – almost 25% less weekly spending in April. This decline is especially noticeable compared to older generations, where spending on games fell by less than 5%.

However, the macro picture is not one-dimensional. The same study shows that in the same month, total spending on games in the US increased by 22% compared to a year earlier. Content subscriptions for consoles and PCs – services like Game Pass and digital content add-ons that are not in mobile games – reached a monthly peak of $562 million. This growth is mainly explained by spending by adults and the launch of Nintendo’s new console. In other words, while the market as a whole continues to grow, a crack has been revealed beneath the surface: the young consumer, who was previously the main growth engine, is spending less.

Less money available for young people

Why is this happening to young people in particular? First, because their economic situation is more fragile. Many young people are entering a job market where it is difficult to find rewarding entry-level jobs, and starting salaries are low relative to the cost of living. In the US, millions of Generation Z members returned to paying student loans this year after a three-year grace period, leaving them with much less money available.

Added to this is a sharp increase in credit card delinquencies among young people under 30, evidence that their monthly balance is in a persistent deficit. When you add to this general inflation, which is making airfare, rent, and food more expensive, it is clear why games are being pushed back in the order of priorities.

Gaming itself is not left out of inflation. New AAA games now cost $70 or even $80, purchasing a next-generation console requires hundreds of dollars, and upgrading a computer for gaming has become more expensive than ever. In other words, spending on the main hobby of young people has become one of the most expensive leisure expenses. For those who receive their first salary or are trying to keep their heads above water with loans and debts, it is a luxury.

This does not mean that young people have stopped playing. On the contrary, Generation Z plays more hours than ever; it is just that they do it differently. Most of them choose platforms that offer free or cheap games with micropayment models. Roblox, for example, is breaking records: more than 111 million daily active users, of whom 64% are 13 and older, and 23 million pay monthly.

The average spend per paying user is more than $20 per month, a figure that illustrates that young people are willing to spend – but mainly within existing worlds and not on full-priced premium games. In addition, social games like Among Us, Lethal Company, and Fortnite have become a meeting place, where social identity and digital visibility – what skin you wear, what your character looks like – are as important as the game itself.

Switch 2

Subscription services also fit these habits: for a relatively low, fixed monthly fee, they provide access to hundreds of titles, eliminating the need to gamble on a single, expensive purchase. Thus, young people play more, try more games, but pay less for a single game.

Older people, on the other hand, are in a different position. Those aged 25 and over have higher and more stable incomes, student debt that has already been settled or paid off, and less credit stress. For them, the decline in spending has been minor, which explains how in June 2025, total spending on games in the U.S. increased by 22% compared to a year earlier. According to Circana, hardware sales increased by 35% thanks to the launch of the Switch 2, and spending on accessories, such as game controllers and gaming headsets, increased by 18%.

At the same time, the mobile market has remained stable with revenues of about $1.7 billion per month, unchanged from last year. In other words, the entire market continues to move forward, but the picture is complex: adults and the hype around launches dictate growth, while young people are cutting back.

For the industry, this is an important lesson: Generation Z has not abandoned games, but has completely changed its consumption habits. It prefers to play a lot, diversify, and spend small, distributed amounts instead of making expensive one-time investments. Those who know how to adapt, offering hybrid subscription models, renewable content, and fair microtransactions, will be able to retain this generation. Those who do not will find that the audience that promised the future of the industry is still playing more than ever, but paying much less.