02/08/2024 – 14:53
By Sam Nussey
TOKYO (Reuters) – A Nintendo Apple Inc. said on Friday that sales of its Switch console fell by nearly half in the April-June quarter and that the company’s profit plunged, falling far short of market estimates.
The company sold just 2.1 million units of the eight-year-old Switch during the quarter, but maintained its full-year sales forecast of 13.5 million units.
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Nintendo said it plans to make an announcement about a successor device to the console later this fiscal year, which ends in March 2025.
Nintendo’s operating profit fell 71 percent to 54.5 billion yen ($365 million), more than a third below analysts’ estimates.
The intellectual property division also performed poorly, with revenue falling to 14.7 billion yen, a 54 percent drop from the same period a year earlier, when the result was boosted by the hit movie “Super Mario Bros.”
“Nintendo was too optimistic about the current year,” said Serkan Toto, founder of consultancy Kantan Games.
“The numbers add to the pressure on Nintendo regarding a Switch 2 reveal,” he said, adding that the July-September quarter will likely also be weak.
Nintendo has a modest slate of games announced for this year, with upcoming titles including “The Legend of Zelda: Echoes of Wisdom” and “Mario & Luigi: Brothership.”
A new “Super Mario” movie is set to be released in April 2026. The company also said it will collaborate on a live-action “The Legend of Zelda” film.
The video game industry is facing rising costs and weak pricing power. Sony-owned studio Bungie announced this week that it would lay off nearly 20 percent of its workforce.
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