Nintendo profits rise to $2.7bn despite Switch sales slowdown

Nintendo posted an increase in sales and net profit for the nine months ending December 31, in what will likely be the final Christmas for Switch before its successor arrives this year.

While Nintendo saw a decrease in hardware and software sales, it provided a slight increase in its forecast for the full year.

The numbers

• Net sales: ¥1.4 trillion ($9.4 billion), up 7.7% year-on-year
• Net profit: ¥408 billion ($2.7 billion), up 17.9% year-on-year
• Hardware: 13.7 million Switch units sold (down 7.8% year-on-year)
• Software: 164 million units (down 4.7% year-on-year)

Forecast for the full year:

• Sales: ¥1.6 trillion expected ($10.7 billion), up 3.2% compared to previous forecast and up 1.8% year-on-year
• Net profit: ¥440 billion expected ($2.9 billion), up 2% compared to previous forecast and 2% year-on-year

Highlights

Sales on Nintendo's own platforms were up 4.7% to ¥1.3 trillion ($8.7 billion), including hardware, software, and accessories, while mobile and IP-related sales increased 93.4% to ¥75.2 million ($505 billion). This was attributed to the revenue generated by the Super Mario Bros Movie released in April 2023.

In terms of hardware, the Switch shipped 13.7 million units during the nine months ended in December 2023, a decrease of 7.8% compared to the 14.9 million sold during the same period in the previous year.

The OLED model shipped 8.17 million units, an increase of 6.2% compared to the previous figure of 7.69 million units sold in the nine months ended in December 2022. The standard model shipped 3.4 million units, a year-on-year decline of 34.9%.

But it was the Switch Lite that showed the most growth during this period at 2.18 million units, marking an increase of 9.1% compared to the two million units sold in the same period the previous year.

Nintendo cited "stable" sales of the Switch models "given the fact the platform is in its seventh year, and the results were generally in line with [its] expectations."

While unit sales of hardware and software both decreased year-over-year, net sales increased by 4.7% to ¥1.35 trillion ($9.1 billion).

Despite an overall decrease in software unit sales, new titles released in 2023 saw strong starts with 24 titles selling over a million, including games from other publishers.

The Legend of Zelda: Tears of the Kingdom sold just shy of 20.3 million units following its launch in May 2023, while Pikmin 4 sold 3.3 million units after its release in July.

Super Mario Bros Wonder sold almost 12 million units after its debut in October. By the end of the third quarter the game reached a global sell-through of 10.7 million units, "making it the fastest-selling Super Mario title to date."

Nintendo noted the success of the Super Mario Bros Movie "had a positive impact on sales of Mario-related titles," with Mario Kart 8 Deluxe selling a further 6.79 million copies, with cumulative sales of 60.6 million units.

Digital sales increased by 11.7% year-on-year to ¥346 billion ($2.3 billion), with Nintendo highlighting an increase in sales for Nintendo Switch Online and DLC for games such as Pokémon Scarlet and Pokémon Violet.

Nintendo also recorded its "highest ever" number of annual players during the nine months ended December 31, 2023, with an estimated 122 million users compared to 114 million during the same period last year.

Elsewhere, regional stats showcased that 70% of sales were made overseas with 43.9% of sales made in the Americas, 25% in Europe, and 21.3% in Japan.

Looking ahead, Nintendo increased its expectations for the full year in its hardware and software sales numbers. The platform holder previously expected to sell 15 million hardware units, and is now expecting 15.5 million. As for software, it previously anticipated to shift 185 million units, which has been revised to 190 million.