In context: The global PC market has been in tumult over the past few years despite newer products, innovative form factors and the release of Windows 11. The PC gaming market has been no exception either, with cumulative sales dropping from a high of $68 billion in 2021 to just $42 billion last year. According to a new report, things will only get worse before getting better.

After the precipitous fall in 2022, the global PC gaming hardware market is expected to recover over the next couple of years, despite persistent recession fears and massive layoffs. That's according to Jon Peddie Research (JPR), which claims the industry will increase its total revenues by up to $5 billion by 2025.

As per the forecast, the PC gaming hardware industry will hit total revenues of $47.1 billion in 2025, up more than 12% from $42.0 billion in 2022. However, things are expected to remain subdued in the short term, as the market is expected to shrink further this year, hitting a low of $37.3 billion, down almost $5 billion from last year.

The research also revealed that once the recovery process begins, the biggest gains will be in the high-end and entry-level segments, while the mid-range will continue to shrink further. While the high-end category is expected to grow 17% from $22.9 billion in 2022 to $26.8 billion in 2025, the entry-level is said to expand from $5 billion to $7.3 billion during the same time.

Meanwhile, the mid-range segment is expected to feel the squeeze from both ends of the market, reducing in size from $14.0 billion to $12.9 billion between 2022 and 2025. In 2023, the mid-range market is expected to hit $11.4 billion in revenues, down $2.6 billion from last year.

According to Dr. Jon Peddie, president of JPR, Intel's entry into the discrete GPU market with its Arc graphics cards, as well as AMD's decision to discount some of its erstwhile-mid-range GPUs are expected to help make the entry-level market more lucrative in the coming years.

According to Ted Pollak, senior game tech analyst at JPR, the improving macroeconomic environment will be instrumental in helping the market to recover in the next couple of years. Another contributing factor to the growth will be the falling prices of high-resolution ultra-wide monitors, which is expected to help popularize them among casual gamers.