A total of around $14.8 billion was spent on video games in US in 2012, according to new NPD figures.
This represents a 9 per cent year-on-year decline from the $16.34 billion spent in US in 2011, claims The NPD Group - despite an increase in digital game spending.
According to the report, '2012 Games Market Dynamics: U.S', physical game sales in the year totaled around $8.88 billion - $7.09 billion on new physical games and $1.79 billion on used and rental software - down from $11.25 billion in the prior year.
Meanwhile $5.92 billion went on 'content in digital format', representing an increase from the $5.09 billion spent in 2011.
"When including all other forms of content spending outside of new physical games, the 2012 U.S. games market was more than twice as large as the total spending on new physical games alone," noted NPD analyst Liam Callahan.
"There were divergent trends when looking at content spending in 2012 as a whole, with a decrease of 21 percent in spending on physical content while digital content spending grew 16 percent; both formats combined for a total decline of 9 percent for the year," he added.
According to NPD Group research figures released in September last year, the US gaming population had declined by five per cent over the prior 12 months to an estimated total of 211.5 million players. It also found that size of key gamer segments are shifting, with mobile players outnumbering Core gamers, which was the largest segment in 2011.