Switch 2 Looms, Original Switch Sales Dip

Nintendo's hardware sales forecast takes another hit as Switch sales fall short of projections. For the first nine months of the fiscal year, dedicated game console sales dropped 31.7% year-over-year to 895.5 billion yen (approximately $5.7 billion), reflecting decreased sales of both the Nintendo Switch console and its software. Mobile and IP-related revenue also experienced a significant decline of 33.9% year-over-year, reaching 49.7 billion yen (approximately $320 million), primarily due to unfavorable comparisons with the highly successful 2023 release of The Super Mario Bros. Movie. Consequently, gross profit decreased by 27.3% year-over-year to 565.5 billion yen (approximately $3.6 billion).

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Nintendo has further revised its financial forecast for the fiscal year ending March 2025, marking the second consecutive downward adjustment. The company anticipates even lower Nintendo Switch hardware sales than previously projected, reducing its forecast by 1.5 million units to 11 million, and software sales by 10 million units to 150 million.

While sales declines were expected for the eight-year-old Switch, the magnitude surpasses Nintendo's initial predictions. Nevertheless, the Switch has achieved remarkable success, exceeding 150 million units sold. While surpassing the PlayStation 2's 160 million sales to become the best-selling console of all time may be unlikely, the Nintendo DS's 154 million unit sales figure is within reach.

Nintendo characterized Switch and software sales in the third quarter (ending December 31, 2024) as "stable considering the platform's age." Overall Switch family sales were down 30.6% year-over-year at 9.54 million units, with software sales declining 24.4% year-over-year to 123.98 million units. However, Nintendo highlighted strong sales of new titles during the quarter, including The Legend of Zelda: Echoes of Wisdom (3.91 million), Super Mario Party Jamboree (6.17 million), Mario Kart 8 Deluxe (5.38 million), and Nintendo Switch Sports (2.63 million). Mario & Luigi: Brothership also achieved sales of 1.4 million units.

Super Mario Party Jamboree stands out as a significant success, outpacing sales of previous Mario Party titles on the Switch within its first 11 weeks of release (October 17, 2024).

Crucially, the number of active Switch players remains high, with 129 million annual playing users in 2024, suggesting continued engagement despite the console's age. Nintendo noted that while Switch unit sales declined, holiday season sales in some weeks even surpassed those of the previous year.

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In light of the financial report, investor anticipation for the Nintendo Switch 2 is high. Nintendo confirmed upcoming Switch titles: Xenoblade Chronicles X: Definitive Edition (March 20 release), and Pokémon Legends: Z-A and Metroid Prime 4: Beyond (scheduled for 2025). The company reiterated the Switch 2's planned 2025 release and announced a dedicated Switch 2 Direct presentation for April 2nd, along with global hands-on events.