UK Games Market Grew by 7.4% to £8.76 Billion in 2025

UK Games Market Grew by 7.4% to £8.76 Billion in 2025
“Game Culture” Merchandise Spending Surges 42%, Industry Faces Employment Decline

 The UK video games market continued its strong growth in 2025. According to new data released by Ukie (the Association for UK Interactive Entertainment) at the start of the London Games Festival, UK consumers spent a total of £8.76 billion on video games in 2025, a 7.4% increase year-on-year, reaching an all-time high.

Nick Poole, CEO of Ukie, said: “Even against a backdrop of rising costs and squeezed household budgets, British consumers spent more on games in 2025 than ever before, which is a remarkable vote of confidence in the medium.”

Digital Software and Hardware Drive Growth; Mobile Steady

By segment, digital software sales grew 7% to £6.03 billion, with digital console sales rising 9.2% yearonyear to £2.49 billion. Hardware sales increased 3% to £2.17 billion, supported largely by the launch of the Nintendo Switch 2 in June 2025. The mobile gaming market also grew 7.9% to £2 billion, with improved monetisation across business models and app stores despite fewer downloads.

“Game Culture” Merchandise Spending Soars

Notably, the “Game Culture” sector – reported separately by Ukie – saw outstanding performance. This segment includes toys and merchandise, soundtracks, books, film and TV licensing, game streaming content, and live events. In 2025, total revenue in this sector reached £566 million, a 42% surge yearonyear, with more than half coming from toys and merchandise.

Specifically, sales of gamerelated film, TV, and soundtracks increased 70% to £159 million; toys and merchandise sales rose 43% to £333 million. Film adaptations generated £77.9 million in 2025, led by A Minecraft Movie, which became the UK’s highestgrossing film of the year with £56.8 million.

Employment Challenges: Largest Recorded Decline in Industry Workforce

Despite market growth, the UK games industry employment situation is concerning. According to TIGA’s Making Games in the UK report, between May 2024 and September 2025, the total UK workforce declined from 28,516 to 27,347, a 4.5% yearonyear decrease – described as the “most severe downturn on record.” During this period, 491 companies cut 3,655 fulltime roles, while 513 studios added 2,571 positions.

Government Launches £30 Million “Games Growth Package”

To address industry challenges and support domestic developers, the UK government has begun rolling out a £30 million Games Growth Package. This includes £28.5 million allocated through the UK Games Fund to support earlystage developers and studio growth, and £1.5 million committed to the London Games Festival over the next three years.

The funding is divided into three strands:

Entry track: grants up to £20,000 for newly formed studios with limited track records.

Emergent track: up to £100,000 for prototyping new games.

Expansion track: up to £250,000 to support project completion and studio growth.

An additional £20 million has been allocated to the Tay Cities region (Angus, Dundee, Fife, and Perth and Kinross) to support local talent and advance creative technologies such as games and virtual reality.

Nick Poole, CEO of Ukie, said: “We welcome the Government’s Games Growth Package as a strong vote of confidence in the UK games industry. Targeted support across the development pipeline will help studios start, scale and stay globally competitive.”

London Ranked ThirdLargest Global Game Development Hub; GTA6 Set to Define 2026

The report also ranks London as the world’s thirdlargest hub for developers, after Los Angeles and San Francisco. In terms of platform preference, 46% of studios identified PC as their main platform, while console games accounted for a larger share of sector jobs.

Looking ahead to 2026, industry observers widely believe that Grand Theft Auto 6, currently in development at Edinburghbased Rockstar North, could become one of the most influential titles in gaming history, expected to generate several billion dollars on launch day alone. As Nick Poole, CEO of Ukie, noted: “The next 12 months could be genuinely defining for the UK games industry, with studios across every region of the country developing titles that will reach millions of players.”

About Ukie

Ukie is the trade body for the UK’s video games and interactive entertainment industry, dedicated to driving growth, innovation, and cultural impact.