Nintendo has lowered its Switch forecast after sales declined 31%

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Nintendo has lowered its Switch forecast after sales declined 31%

Nintendo has lowered its sales forecast for Nintendo Switch by 1 million units, after it reported a year-on-year sales decline of 31%.

In its latest earnings report for the three months ended September 30, the Switch firm said it had lowered its hardware sales forecast to 12.5m for the fiscal year, down from 13.5m, and lowered its operating profit

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by 10% to ¥360 billion ($2.4bn).

Nintendo partly attributed the hardware sales decline on a strong first half of the previous fiscal year, when the Super Mario Bros. Movie boosted game sales, and The Legend of Zelda: Tears of the Kingdom was released.

“There were no such special factors in the first half of this fiscal year,” it said, “and with Nintendo Switch now in its eighth year since launch, unit sales of both hardware and software decreased significantly year-on-year.”

The Switch is now more than seven years old, and Nintendo has said it will announce its successor console before the end of March 2025. Speaking following the publication of Tuesday’s results, president Shuntaro Furukawa said there was no change to this announcement plan.

The company’s results for the first half of its current fiscal year report an operating profit of ¥121.5 billion ($798 million), which is down 56.6% compared to the same ******* last year.

The company confirmed it sold in 4.72 million Switch consoles during the first half of the fiscal year, bringing the all-time sales total for the hardware to 146.04 million. The Switch has to clear 154 million (Nintendo DS) and at least 160 million (PS2) to become the best-selling console in history.

In software (covering April through September), Paper Mario The Thousand-Year Door, released in May, sold 1.94 million units, while Luigi’s Mansion 2 HD, released in June, sold 1.57 million units. The Legend of Zelda: Echoes of Wisdom, which was released in late September, sold 2.58 million units in its opening days.

Going forward, the company released Super Mario Party Jamboree in October, and plans to release Mario & Luigi: Brothership this week, followed by Donkey Kong Country Returns HD in January, and a Xenoblade Chronicles X port in March.

Dr Serkan Toto, CEO of Tokyo-based game industry consultancy Kantan Games, told VGC that with a weaker software line-up than in previous years, the sales decline for the ageing Switch hardware was inevitable.

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THE BEST-SELLING SWITCH GAMES

*As of September 31, 2024 (compared to June 2024)

1. Mario Kart 8 Deluxe – 65.27m (+1.37m)
2. Animal Crossing: New Horizons – 46.45m (+0.60m)
3. Super Smash Bros. Ultimate – 35.14m (+0.48m)
4. Legend of Zelda: Breath of the Wild – 32.29m (+0.24m)
5. Super Mario Odyssey – 28.50m (+0.29m)
6. Pokemon Sword/Shield – 26.44m (+0.09m)
7. Pokémon Scarlet & Violet – 25.69m (+0.4m)
8. Legend of Zelda: Tears of the Kingdom – 21.04m (+0.24m)
9. Super Mario Party – 20.98m (+0.14m)
10. New Super Mario Bros. U Deluxe – 17.77 (+0.16m)

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“Anybody who has been following Nintendo this year cannot be too surprised about the results,” he said. “We are in a hit-driven business: Without blockbusters, you cannot make sales that would really move the needle for a company like Nintendo.

“The company understandably keeps the big hitters for the next console, but I think even their adjusted forecast is still too optimistic. Look at Q1 2025, for instance, which has only one somewhat big release with Donkey Kong Country Returns HD.”

Toto said the only positive surprise he could see was the jump in Nintendo’s digital sales, which have increased from 50.2% to 56.3% year-on-year, contributing to an increase in its ****** profit margin of 1.5%.

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