Nintendo ADR (OTC:NTDOY) has reported a substantial decline in sales and net profit for the first quarter of FY2025, marking a challenging period in the eighth year of the Nintendo Switch's lifecycle.
The company attributes this decline to a relatively quiet release schedule compared to the same period last year, which saw the launch of blockbuster titles like The Legend of Zelda: Tears of the Kingdom, GamesIndustry.biz reported.
Financial Overview
For the three months ending June 30, 2024, Nintendo's financial results reveal a stark year-on-year comparison:
- Net Sales: 246.6 billion yen ($1.6 billion), a 46.5% decrease
- Net Profit: 80.9 billion yen ($542.9 million), down 55.3%
- Hardware Sales: 2.1 million units, down 46.3%
- Software Sales: 30.6 million units, down 41.3%
Sales across Nintendo's platforms, including hardware, software, and accessories, fell 46.4% to 229 billion yen. Mobile and IP-related sales also dropped by 53.8% to 14.7 billion yen.
Hardware Performance
The decline in hardware sales is notable, with the Nintendo Switch family seeing a 46.3% drop to 2.1 million units sold:
- Standard Model: 530,000 units (down 18.4%)
- Switch Lite: 330,000 units (down 23.3%)
- OLED Model: 1.24 million units (down 56.1%)
Software Sales
Software sales also saw a decline, with unit sales dropping 41.3%, from 52.21 million the previous year to 30.64 million units. Key releases included:
- Paper Mario: The Thousand Year Door, released in May, sold 1.76 million units.
- Luigi's Mansion 2 HD, released in June, sold 1.19 million units.
- Princess Peach: Showtime, a release from the previous fiscal year, achieved over 1.3 million units in cumulative sales during this period.
Digital sales accounted for over half of the total software sales on Switch during Q1 2025 but fell 32.6% year-on-year to 80.7 billion yen compared to 119.6 billion yen the previous year. Despite this decline, Nintendo noted that sales of download-only software and Nintendo Switch Online revenue remained stable, increasing the proportion of digital sales year-on-year.
Regional Sales Breakdown
Nintendo highlighted that 74.2% of sales were made overseas, with the following regional distribution:
- Americas: 44.8%
- Japan: 25.8%
- Europe: 21.3%
Looking Ahead
Despite the downturn, Nintendo maintains its full-year expectations announced during its financial report on May 7. The company is likely banking on future releases and strategic initiatives to regain momentum.
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