Ignoring the "going back to reality" post covind small drop, the industry has been growing since forever, as all its areas are growing:
- PC, console and specially mobile are growing.
- VR, game subs and cloud gaming are growing too, even if still are a small portion of the industry and far from becoming mainstream. Seems they will become more important, but won't replace flat 2D displays, to buy games and to play natively, they'll continue coexisting.
- Regarding physical vs digital, physical game sales are decreasing and becoming a very small part of the market, maybe in the future will be limited to special/collector editions or something like that. They are being replaced by digital game sales and specially addons (special editions, DLC, IAP, passes).
- Regarding business model, GaaS is the most played and top grossing one, with its addons becoming the biggest and fastest growing game revenue source, but always there will be space for game sales of non-GaaS titles
So it is fair to assume all these trends will continue. But there's a very imporant one not included here because can't be measured with numbers: the convergenge between console, PC and mobile markets.
Over years the PC, console and mobile hardware is becoming more and more similar. As of now home consoles basically use tweaked PC hardware, and portable consoles use tweaked mobile hardware. Which at the same time, mobile and PC hardware is becoming more and more similar. As this trend continues over time, at some point all 3 will use the same architecture.
Same happens with OS: consoles use a tweaked Linux, or in case of some portable consoles, Andoid (which can be installed or emulated in PC OS, and Android is expanding to PC too). The game engines already totally converged: UE, Unity, Godot and similar can export their games to console, PC and mobile, they are the same for all 3 platforms.
Regarding stores, we see that they are starting to become multiplatform: MS expanded to PC and wants to expand to mobile. Sony seems will do the same. Steam tried it with the Steam Machines and now to the PC handhelds to joing the portable consoles market. Epic is fighting with MS to have their mobile stores. Google Play is expanding to PC.
TLDR:
Seems that the future is to have several platform agnostic ecosystems where you'll buy or rent games once and you'll be able to play them on any form factor, which will share pretty much the same hardware, OS and game engine: desktop PC, laptop PC, home console, portable console, tablet, smartphone, smart tv. In most cases having the option to play them natively or via cloud gaming (in some devices only via cloud).
i also keep hearing the console market is stagnant, but i think this is not true
It isn't true, ignoring the covid peak exception, according to all market researchers console, PC and mobile have been growing in the last 10 years. Some examples, there are way more (the specific number and what they include or not changes, but you can see they are have been growing the last 10 years):
IDG/data.ai:
Newzoo 10 years change (includes games subs + addons in case of consoles):
Pelham Smithers (doesn't include 2023, graph inflation -which means growth has been flattened compared to the other graphs- adjusted to 2022, doesn't include console subs and maybe not even addons):