Nintendo lowers fiscal forecast with Switch hardware and software in decline

Nintendo has lowered its financial forecast for the current fiscal year after Switch hardware and software sales took a hit.

As noted in the company's fiscal report for the six months ended September 30, 2024, hardware sales were down by 31 percent year-over-year to 4.72 million units. Software sales fell by 27.6 percent over the same period to 70.28 million units.

Nintendo noted that hardware and software sales were largely driven by the launch of Tears of the Kingdom during the previous fiscal year, and said the lack of a similarly impactful release this year has caused a decline.

Even so, the company stated that sales of The Legend of Zelda: Echoes of Wisdom made a "good start," with the title shifting 2.58 million units since September. Other sales highlights over the past six months included Paper Mario Thousand-Year Door (1.94M units) and Luigi's Mansion 2 HD (1.57M units).

Lifetime Nintendo Switch hardware sales have now eclipsed 146 million units, while software sales have topped 1.3 billion units. The console could still usurp the Nintendo DS as the best-selling Nintendo system in history if it can surpass 154.02 million lifetime sales.

Nintendo now expects the Switch to sell 12.5 million units during the current fiscal year, having downwardly revised its forecast by from 13.5 million units. 

Glancing briefly at Nintendo's digital business, digital sales fell by 26.5 percent to 159.9 billion yen over the past six months. Nintendo said that downturn was mainly due to a decrease in sales of digital software.

Sales within the company's mobile and IP related business declined by 43.3 percent year-on-year to 31.2 billion yen. Nintendo noted the last fiscal year saw the release of The Super Mario Bros. Movie, which brought huge engagement but in turn contributed to a decline this year.

Consolidated net sales for the first half of the fiscal year decreased by 34.3 percent year-on-year to 523.2 billion yen ($3.44 billion). Operating profit declined by 56.6 percent to 121.5 billion yen ($798.6 million), and profit attributable to owner of parent decreased by 59.9 percent to 108.6 billion yen ($713.8 million).

Taking that into account, Nintendo has lowered its full-year forecast and expects to deliver net sales of 1.28 billion yen (down from 1.35 billion yen) by March 31, 2024. Operating profit is now expected to total 360 million yen (down from 400 million yen). Net and ordinary profit forecasts remain unchanged.