Todd Mitchell of Brean Capital commented in a note on Friday that November's NPD data that showed total retail video game industry sales declining 12 percent in November to $2.4 billion was better than the 18 percent decline projected.

Mitchell notes that upside to estimates came from just over $1.1 billion in software revenue, down 2 percent from the prior year and faring better than the 26 percent drop expected. The analyst notes that improved traction from Nintendo software and aggressive Black Friday promotions drove upside.

Hardware revenue dropped 22 percent to just over $1 billion, modestly lower than the $1.1 billion Mitchell projected. The analyst notes that the drop was attributed to a sharper drop-off in prior-gen consoles, while next-gen consoles continue to sell well, tracking nearly 80 percent higher than the prior cycle.

Mitchell states that major titles from Ubisoft and Microsoft Corporation (NASDAQ: MSFT) sold lower-than-expected, pointing to a “less competitive runway” for top quality releases from third party publishers.

Mitchell concludes by noting that digital revenue is growing in the double-digits and that industry fundamentals will remain strong in December, which may set the stage for upside to conservative guidance.