In a nutshell: There’s plenty of excitement surrounding the upcoming Xbox Series X and PS5 consoles, with many fans already saving up to buy one of the machines, but it's having a negative effect on the video game industry. According to new figures, sales of the PS4 and Xbox One plummeted last month, down 35 percent compared to one year earlier.

Market analysts NPD Group reported that video game hardware sales in the US were at $129 million in January, $70 million lower than in January 2019. The news comes after Sony's financial results showed PlayStation 4 sales were down 25 percent over the holiday season.

Niko Partners analyst Daniel Ahmad notes that there are several reasons behind the drastic decline, including the Xbox One and PS4 both “having held at current price points for a number of years.” He also blames the early announcement of the PS5 and Xbox Series X—15 months before launch, in the case of the PlayStation 5—and the fact that both consoles are backward compatible with the current generation of games.

Ahmad also points out that the move to HD gaming across multiple devices won’t have helped, neither will delays to some of 2020’s biggest titles, such as Cyberpunk 2077 and The Last of Us 2.

It seems sales of both Sony’s and Microsoft’s machines are falling faster than the last time a new generation was announced. "An interesting takeaway from the US NPD report is that PS4 and XB1 hardware sales in Jan 2020 are considerably lower than PS3 and 360 were in Jan 2013,” tweeted Ahmad. “Next-gen consoles are around the corner but both are declining sharper than expected. Switch continues to remain steady."

Video game sales also took a hit last month, down 31 percent YoY from $451 million to $311 million. Total spending across video game hardware, software, accessories, and game cards totaled $678 million, down 26 percent from $918 million a year ago.

NPD also listed the best-selling games in the US for January. The chart was topped by Dragon Ball Z: Kakarot, followed by Call of Duty: Modern Warfare 2019. Grand Theft Auto V– the best-selling video game in U.S. history—reach number five, the highest it’s been since August 2019.

Make sure to check out our opinion on what the successors to the PS5 and Xbox Series X will look like, in the Future of Tech: game consoles feature.

Top ten selling games in the US for January, sorted by dollar sales—not number of units sold:

1. Dragon Ball Z: Kakarot

2. Call of Duty: Modern Warfare 2019

3. Madden NFL 20

4. Star Wars Jedi: Fallen Order

5. Grand Theft Auto V

6. NBA 2K20

7. Super Smash Bros. Ultimate*

8. Mario Kart 8*

9. Ring Fit Adventure

10. Red Dead Redemption II