What’s behind Nintendo’s 42% drop in profits?

Nintendo’s profits tumbled as sales of its Switch console lost momentum, prompting the Japanese video-game maker to lower its full-year forecasts.

Kyoto-based Nintendo Co., which created the Super Mario franchise, reported Tuesday an April-December profit of 237 billion yen ($1.5 billion), down 42% from the same period the previous year.

Nine-month sales dropped 31% to 956 billion yen ($6 billion), according to Nintendo, which did not break down quarterly results.

The company now expects to rake in a 270-billion yen ($1.7 billion) profit for the fiscal year through March, down from the previous forecast for 300-billion yen ($1.9 billion).

Sales of Nintendo machines for the nine-month period fell to 9.54 million units from 13.7 million last year.

Nintendo now expects to sell 11 million Switch consoles for the full fiscal year, lower than its initial projection of 12.5 million.

Game software sales in April-December declined to nearly 124 million from 164 million, although “Super Mario Party Jamboree,” remained popular, with 6.17 million units sold.

The latest “Legend of Zelda” game software was also in demand, selling 3.4 million units globally after going on sale in September.

Nintendo said, while demand has dwindled for the Switch, now in its eighth year after its debut, it was still being purchased by a significant number of people. The number of Switch players remains above 100 million, it said.

Nintendo is banking on its successor, called Switch 2, which goes on sale later this year. Events where people can try it out are rolling out from April around the world.

Nintendo also noted the opening of Super Nintendo World, an amusement facility, in May at Epic Universe in Orlando, Florida will help woo people to its content.

Yuri Kageyama is on Threads:
https://www.threads.net/@yurikageyama

—Yuri Kageyama, AP Business Writer

View the full article