Nintendo expects revenue and profit to decline in FY25 due to falling sales of Switch and video games

Nintendo has released its financial report for the fiscal year ended March 31, 2024. Despite growth in all key metrics, sales of Switch consoles continued to gradually decline. This led the Japanese company to lower its financial outlook for FY25.

Financial highlights

• According to its consolidated financial results, Nintendo reached ¥1.67 trillion ($10.8 billion) in net revenue in FY23/24, up 4.4% year-over-year.
• Operating profit was ¥528.9 billion yen ($3.42 billion), up 4.9% compared to the previous fiscal year. Net profit grew 13.4% year-over-year to ¥490.6 billion ($3.18 billion).
• 78.3% of all Nintendo sales came from outside of Japan. The Americas was the biggest region (44.3% of the total), while Europe and Japan accounted for 24.3% and 21.7% respectively.
• Digital sales accounted for 50.2% of Nintendo’s annual revenue from video games. They increased by 9.4% year-over-year to ¥443.3 billion ($2.87 billion).

• For the current fiscal year ending March 31, 2025, the company forecasts declines in all key business metrics. Its net sales and net profit are expected to fall 19.3% and 38.9% year-over-year, respectively.
• The main reason is the projected downfall in sales of both video games and hardware. For example, Nintendo expects the number of Nintendo Switch units sold to decline by 14%, and the number of game copies sold to fall 17.4%.
• “Nintendo Switch has entered its eighth year since launch, and while it will be challenging to sustain the same sales momentum as before, we will work to maintain high user engagement with the hardware and invigorate the platform so that more consumers continue to play Nintendo Switch for longer,” the company noted.

• During an earnings call, Nintendo president Shuntaro Furukawa told investors that the company plans to announce the successor to Nintendo Switch within the new fiscal year (ending March 31, 2025). “We will be holding a Nintendo Direct this June regarding the Nintendo Switch software lineup for the latter half of 2024, but please be aware that there will be no mention of the Nintendo Switch successor during that presentation,” he said.”

Hardware and game sales

• In FY23/24, the company sold 15.7 million Nintendo Switch units, down 12.6% year-over-year. The OLED version remained the highest-selling model — its sales grew 1.1% to 9.32 million units.
• As of March 31, 2024, Nintendo Switch reached 141.32 million units sold, cementing its place as the third best-selling game console of all time — behind only Nintendo DS (154 million) and PlayStation 2 (over 155 million).
• The company also recorded the highest number of annual playing users at 123 million. This metric refers to people who launched a game on one of the Nintendo Switch systems during the 12-month period.

• Last year, Nintendo sold 199.67 million copies of games for its consoles, down 6.7% year-over-year.
• There were also 31 titles that sold over 1 million units within the 12-month period, 20 of which were Nintendo’s first-party games.
• The Legend of Zelda: Tears of the Kingdom was the most successful new release last year, with 20.61 million units sold as of March 31, 2024. Other top sellers include Super Mario Bros. Wonder (13.44 million), Mario Kart 8 Deluxe (8.18 million), and Nintendo Switch Sports (3.51 million).

Below are the 10 best-selling Nintendo Switch games (as of March 31, 2024):

1. Mario Kart 8 Deluxe — 61.97 million copies;
2. Animal Crossing: New Horizons — 45.36 million copies;
3. Super Smash Bros. Ultimate — 34.22 million copies;
4. The Legend of Zelda: Breath of the Wild — 31.85 million copies;
5. Super Mario Odyssey — 27.96 million copies;
6. Pokémon Sword / Shield — 26.27 million copies;
7. Pokémon Scarlet / Violet — 24.92 million copies;
8. Super Mario Party — 20.66 million copies;
9. The Legend of Zelda: Tears of the Kingdom — 20.61 million copies;
10. New Super Mario Bros. U Deluxe — 17.45 million copies.