Game Sales Go Soft

Updated from 6:15 p.m. EST

Video game-software sales plunged 18% in November, according to a new research report, marking the third straight month of weak sales.

Midtier players Take-Two Interactive (TTWO) and THQ (THQI), which saw their retail sales drop 63% and 32%, respectively, led the decline, according to data from NPD Group obtained by TheStreet.com Tuesday.

The drop in overall sales came despite solid growth posted by Electronic Arts (ERTS) and Activision(ATVI).

In the meantime, sales of two new game systems expected to be hits this holiday season also appeared to be light. Microsoft's (MSFT) Xbox 360 and Sony's (SNE)PlayStation Portable were each significantly outsold by older, rival game systems.

Coupled with other recent news from the industry, the new report, from industry research firm NPD Group, could portend a gloomy holiday season for the video game-software sector. Like most other consumer industries, video-game companies collect the lion's share of their sales in the holiday period.

Overall, retail video game-software sales in the U.S. fell from $849 million in November last year to $696 million last month, according to the confidential data from NPD, which was obtained by TheStreet.com.

EA maintained its position as the top-selling publisher, as its games garnered 20.6 of the retail sales market. Activision came in second with 14%.

Among public companies, the biggest percentage declines in sales were posted by Take-Two, THQ, Majesco (COOL) and Atari (symbol). However, none of those declines was particularly surprising.

Atari and Majesco have been floundering for months, beset by management turmoil and poorly received products. Majesco's sales fell 63% to $5 million, while Atari's dropped 24% to $19 million.

Meanwhile, both Take-Two and THQ faced tough comparisons with last year, when both companies' results were boosted by hit products. Take-Two, for instance, saw its sales fall $37 million, from the $100 million it posted last November, when its results were dominated by Grand Theft Auto: San Andreas.