Gen Z has started cutting back on video games purchases. They’re also keeping a tight grip on their wallets for other types of purchases, too, but it’s video games that stand out in the data (via Gamespot). And with traditional game sales dipping, it signifies what many are calling a new gaming economy.
Circana recently released data on this new phenomenon, revealing that video game sales among 18- to 24-year-olds dropped 25% from 2024 to 2025. Interestingly, sales were not impacted in older demographics, so it’s very much a Gen Z trend. At the same time, only 4% of US video game players buy a new game more than once per month.
There are plenty of driving factors behind all of this. A struggling economy and job market, which Gen Z has been impacted by more than any other generation, have played a part. Let’s not forget that video game prices have also skyrocketed in recent years, and it’s even rumoured that the highly anticipated upcoming GTA 6 could hit the market at upwards of $100. Simply put, young gamers are strapped for cash and much less willing to make big video game purchases like they did before, and it’s all down to the current climate.
Interestingly, though, the gaming market itself is far from struggling. Despite young gamers spending less, global game revenues hit $196.7 billion in 2025 according to Newzoo, up 7.4%. Player counts across mobile (3bn), PC (936m), and console (645m) have also steadily increased, even with complaints about ‘modern video games’ not being as good as previous-generation games persisting across social media.
So, What Games Are Gen Z Playing?
With Gen Z officially deciding to cut back on traditional video games, which typically retail at around $70 now, the question now centers around what games they’re actually playing, or whether they’re even playing at all.
The truth is that the gaming market as we once knew it has shifted massively post-2020. The COVID-19 pandemic effectively kick-started it, leading to a huge growth in free-to-play (F2P) games and skill games, most of which exist in the mobile market. These are, in effect, breathing life into the Gen Z gaming market, keeping it alive and providing an outlet for younger gamers who simply don’t want to spend big on purchases anymore.
PvP Skill Games
PvP skill games have completely taken off over the past few years, most notably with younger players. Platforms like Skillz, where you can pick from arcade games, puzzles, and more, match players up from around the world and allow them to place wagers before each game. Whoever the winner is takes the cash prize and Freaky Gaming breaks down how you can withdraw winnings from these types of gaming sites.
In a nutshell, it’s a new type of short-form gaming where players face off against each other in skill-based games for cash rewards, which is why millions of Gen Z players are engaging and the global skill gaming market is projected to reach over $92 billion by 2030 according to Grand View Research.
From Gen Z’s perspective, it’s a case of why pay for an ultra-expensive AAA game when you can simply play a mobile PvP skill game and potentially win rewards for your efforts.
Free-to-Play Games
Free-to-play games are also popular with Gen Z and have kept the gaming industry afloat during recent times. It’s actually been recently reported that 85% of all gaming revenue comes from F2P titles, which generate money through microtransactions, in-game ads, and purchases of virtual currencies. Gen Z doesn’t seem to have a problem with microtransactions, though, so the likes of Delta Force, Roblox, and other F2P games are all booming.
What’s also fascinating about the rise of F2P games is that many of them are what you would call ‘forever games’, something that Gen Z is also a fan of. Forever games are exactly what they sound like: they’re games intended to be played forever, as they continuously receive updates year after year.
And because so many of these forever games and sandbox games are free-to-play, a large portion of Gen Z gamers are naturally going to find it difficult to go back to traditional, overpriced AAA games.
What the Future of Gen Z Gaming Looks Like
With everything going on in gaming at the moment, from record-high development costs to uber expensive hardware, it’s not a shock that Gen Z is opting to hold back on purchases. In place of traditional video games, many have found other outlets in skill-based cash games and popular F2P titles instead.
These trends and the data tell us that this is likely going to be the future of gaming, and so it’s highly likely that the game model of old is going to take a back seat over the coming years. Make no doubt about it, short-form, cash-based games, particularly on mobile, are going to be the industry’s biggest revenue driver of all moving forward, something that’s going to shake up the industry in a major way.