Sales of video games and consoles have been sluggish, but shares of the game makers are soaring.
The research group NPD reports that domestic sales of video games by retailers fell nearly 10 percent in the first-quarter.
But investors are overlooking some middling performance and focusing on what they hope will be an exciting future.
So far this year, shares of Activision Blizzard (ATVI) and Take-Two Interactive (TTWO) have both soared by more than 40 percent. Industry leader Electronic Arts (EA) is up 24 percent.
And retailer Gamestop (GME) has beat them all, up 49 percent since the beginning of the year.
Electronic Arts and Activision will report first quarter results this week, and analysts aren't expecting anything special.
So what's driving the stocks higher despite so-so performance? It's the expectation for a new round in the console war, with new Xbox and PlayStation models rolling out in time for the holidays. Microsoft (MSFT) is expected to unveil the new Xbox on May 21st.
And we already know Sony's (SNE) PlayStation 4 will have touch-sensing controllers and a 'share' button to allow gamers to live-cast their play to friends. Sony is likely to release more details at next month's E3 videogame conference.
In the meantime, though, console sales have slumped as gamers await the new models, or anticipate that current models will be deeply discounted.
As for the game makers, they've had some high profile releases this year. EA has "Crysis 3" and "Dead Space 3". Analysts will be watching sales of those games when the company reports.
EA has also been dealing with the surprise resignation in mid-March of its CEO. The company has not yet named a replacement. And the company warned that its earnings for the first-quarter were likely to fall short of Wall Street expectations.
A fourth video game maker, THQ, filed for bankruptcy in December, and it's in the process of selling of its business in parts.
The tepid offering of new games has weighed on Game Stop. The retailer is also dealing with a customer base that has been migrating to cheaper mobile and social games. EA forecasts that digitally delivered video games may account for half of its sales by 2015.
-Produced by Drew Trachtenberg