Lockdown measures have resulted in a spike in video game sales in April. Per the NPD Group report, U.S. gaming industry witnessed record sales across hardware, software, accessories and game cards, totaling $1.5 billion (up 73% year over year) in April.

Coronavirus Buoys Video Gaming Industry

Coronavirus, which has infected more than five million globally, has resulted in drastic changes in lifestyle and preferences of people so as to abide by social-distancing measures. The pandemic has forced consumers to resort to online retailers for purchases of food items and other goods and to turn to video streaming services and other modes of in-house entertainment. Now, when almost all U.S. states have begun the process of reopening and easing social-distancing norms, people are still trying to minimize human-to-human contact.

Highlighting the ‘new normal’, the NPD Group report further states that software sales rose 55% last month, to $662 million. Final Fantasy VII: Remake stood out as the best-selling game, followed by Call of Duty: Modern Warfare and Nintendo’s (NTDOY - Free Report)  Animal Crossing: New Horizons. Going on, the report shows that there was a 163% surge in hardware sales to $420 million, with the Nintendo Switch topping the numbers in both unit and dollar sales. The PlayStation 4, Xbox One, and Switch saw soaring sales of more than 160% year over year, per the report.

Sales in the first quarter were up 9% year over year as people were confined to their houses due to the coronavirus outbreak (per the NPD Group report). They spent a record $10.86 billion on computer games, hardware, and accessories, according to the report.

Top gaming companies have raised their revenue expectations for 2020 while many have reported a surge in sales. Nintendo’s profits in the first quarter of 2020 more than tripled from the previous quarter. The company sold a record 11.8 million units of Animal Crossing in March, making it the best Switch launch since its release in 2017.

Video Game ETFs to Shine

Against this backdrop, investors can take a look at the following ETFs:

VanEck Vectors Video Gaming and eSports ETF (ESPO - Free Report)

The fund seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS Global Video Gaming and eSports Index, which is intended to track the overall performance of companies involved in video game development, esports, and related hardware and software. It holds 25 stocks in its basket. Top gaming companies like Nintendo, Activision Blizzard (ATVI - Free Report) and Zynga (ZNGA - Free Report) have spots in its top ten holdings. With AUM of $220.6 million, the fund charges 55 basis points in expense ratio.

Global X Video Games & Esports ETF (HERO - Free Report)

The fund seeks to invest in companies that develop or publish video games, facilitate the streaming and distribution of video gaming or esports content, own and operate within competitive esports leagues, or produce hardware used in video games and esports, including augmented and virtual reality. It holds 41 stocks in its basket. Top gaming companies like Nintendo, Activision Blizzard and Zynga are in the top ten holdings. With AUM of $110.3 million, the fund charges 50 basis points in expense ratio.

Wedbush ETFMG Video Game Tech ETF (GAMR - Free Report)

The fund provides pure-play and diversified exposure to a dynamic intersection of technology and entertainment. It also corresponds generally to the price and yield performance of the EEFund Video Game Tech Index. The index is designed to reflect the performance of companies involved in the video game technology industry, including game developers, console and chip manufacturers and game retailers. It holds 86 stocks in its basket. Top gaming companies like Activision Blizzard and Zynga are among its top ten holdings. With AUM of $88.3 million, the fund charges 75 basis points in expense ratio.