Nintendo revenue and profit beat expectations despite 34.4% drop in Switch 2 hardware sales
Nintendo's first-quarter revenue and net profit both exceeded market expectations, even as Switch 2 hardware sales fell sharply. For the quarter ended June 30, Nintendo reported revenue of 517.8 billion yen, or about $3.28 billion, compared with the 444.96 billion yen median estimate from Refinitiv analysts. Net profit was 147.4 billion yen, versus an expected 78.3 billion yen. Nintendo's shares closed 2.87% higher before the earnings release on Thursday, Aug. 6. The Japanese game company maintained the full-year guidance it issued in May for the fiscal year ending March 2027. It continues to forecast net sales of 2.05 trillion yen. Switch 2 hardware sales fell 34.4% year over year to 3.82 million units. Sales of the original Switch declined 31.8% to 660,000 units. Nintendo said that although hardware sales were below the year-earlier level, consumers continued to purchase the Switch 2, helped by factors including new game releases. Nintendo said higher component costs, particularly for memory, and tariffs had created about 100 billion yen in cost pressure, which has been included in operating costs. The flagship Switch 2, which launched last June, uses memory chips whose prices have risen sharply amid strong demand from the artificial-intelligence industry. Game-software sales were driven mainly by "Everybody's Party: Dream Life" and "Pokémon Pokopia," which sold 7.94 million and 1.27 million copies, respectively. Nintendo said a steady stream of new releases is essential to expanding the Switch 2 install base. A consistent lineup of new games can help the console attract a broader group of consumers. Nintendo raised the Switch 2 price in Japan on May 25, but said actual console sales in its domestic market remained solid. The company previously announced that the Switch 2 would become $50 more expensive in the U.S. starting Sept. 1, with the retail price rising from $449.99 to $499.99. Outside its gaming business, "The Super Mario Galaxy Movie" has surpassed $1 billion in global box office revenue since its worldwide release on April 1. It is the second-highest-grossing video-game adaptation in film history.
For the quarter ended June 30, Nintendo reported revenue of 517.8 billion yen, or about $3.28 billion, compared with the 444.96 billion yen median estimate from Refinitiv analysts. Net profit was 147.4 billion yen, versus an expected 78.3 billion yen.
Nintendo's shares closed 2.87% higher before the earnings release on Thursday, Aug. 6.
The Japanese game company maintained the full-year guidance it issued in May for the fiscal year ending March 2027. It continues to forecast net sales of 2.05 trillion yen.
Switch 2 hardware sales fell 34.4% year over year to 3.82 million units. Sales of the original Switch declined 31.8% to 660,000 units. Nintendo said that although hardware sales were below the year-earlier level, consumers continued to purchase the Switch 2, helped by factors including new game releases.
Nintendo said higher component costs, particularly for memory, and tariffs had created about 100 billion yen in cost pressure, which has been included in operating costs. The flagship Switch 2, which launched last June, uses memory chips whose prices have risen sharply amid strong demand from the artificial-intelligence industry.
Game-software sales were driven mainly by "Everybody's Party: Dream Life" and "Pokémon Pokopia," which sold 7.94 million and 1.27 million copies, respectively.
Nintendo said a steady stream of new releases is essential to expanding the Switch 2 install base. A consistent lineup of new games can help the console attract a broader group of consumers.
Nintendo raised the Switch 2 price in Japan on May 25, but said actual console sales in its domestic market remained solid. The company previously announced that the Switch 2 would become $50 more expensive in the U.S. starting Sept. 1, with the retail price rising from $449.99 to $499.99.
Outside its gaming business, "The Super Mario Galaxy Movie" has surpassed $1 billion in global box office revenue since its worldwide release on April 1. It is the second-highest-grossing video-game adaptation in film history.