LDN - Business

Nintendo reports lower profits as demand drops for its aging Switch console

[November 05, 2024] By YURI KAGEYAMA

TOKYO (AP) — Nintendo, the Japanese video game maker behind the Super Mario franchise, said Tuesday that its profit fell 60% in the first half of the fiscal year, as demand waned for its Switch console, now in its eighth year since going on sale.

Kyoto-based Nintendo Co. reported a 108.7 billion yen ($715 million) profit for the April-September period, as sales slipped 34% from the previous year to 523 billion yen ($3.4 billion).

More than 74% of its sales revenue came from overseas, according to Nintendo, which didn’t break down quarterly numbers.

Global Switch sales during the period dropped to 4.7 million machines from 6.8 million units the previous year.

But Nintendo said in a statement that Switch sales were still growing and vowed to stick to its goal of selling a Switch console to each and every individual, not just one Switch per every household.

Nintendo stuck to its earlier projection for a 300 billion yen ($2 billion) profit for the full fiscal year through March 2025, down nearly 29% from the previous fiscal year.

Annual sales were forecast to drop 23% to1.28 trillion yen ($8.4 billion).

It also lowered its Switch sales projection for the fiscal year to 12.5 million units from an earlier forecast to sell 13.5 million.

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A traveler walks past an advertisement featuring a Nintendo character at Narita airport in Narita near Tokyo, on June 10, 2022. (AP Photo/Shuji Kajiyama, File)

Nintendo and other game and toy makers rake in their biggest profits during the Christmas shopping season, as well as New Year’s, a holiday celebrated with fanfare in Japan, when children receive cash gifts from grandparents and other relatives.

Nintendo has not yet announced details on a successor to the Switch.

Among its million-seller game software titles for the fiscal half were “Paper Mario RPG,” which sold 1.95 million units since going on sale in May, and “Luigi Mansion 2 HD,” hitting nearly 1.6 million in sales.

Overall, more than 70 million Switch games were sold during the period, for a total of nine titles that became million-sellers, including products from third-party manufacturers, or makers that aren’t Nintendo.

Still, that was down from more than 97 million games sold the previous year.

The release of a Super Mario Brothers movie lifted sales in the previous fiscal year, while the absence of such a movie this fiscal year negatively impacted the latest results, Nintendo said. Revenue also declined in its mobile-game offerings and IP-related businesses, it said.

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