Nintendo has seen some massive success and profits with the Switch since the console’s launch in 2017, but those profits appear to be dwindling in the lead-up to the release of the Switch 2.
The company published its most recent earnings report on August 2 and it revealed details about declining profits. Particularly the company saw a 55% decrease in net profits for the quarter ending on June 30 compared to the same period last fiscal year.
That being said, Nintendo did end up seeing an overall higher total profit for the quarter than what it was forecasting. This total amounted to around 80.9 billion Japanese Yen, Engadget reports. Nintendo also sold fewer Nintendo Switch consoles this quarter compared to the same time last year, reaching around 2.1 million unit sales.
This amount is nearly half (43.1%) what it sold for the same quarter in 2023. However, the unit sales are similar to the previous quarter this year so Nintendo views the Switch console sales as stable.
Declining Nintendo profits may be due to people saving for the Switch 2
Although Nintendo views Switch sales as stable, it doesn’t exactly give a reason for the lower unit sales year-over-year. The reason may not be that complex, though. Nintendo’s Switch console is fairly old at this point. Having released in March of 2017, it’s now more than 7 years old.
Rumors have been circling for several months now that Nintendo plans to release the Switch 2 in 2025. If that’s the case, the Switch is at the end of its life cycle. Even if games continue to be released for the Switch after the Switch 2 comes out, people might be avoiding Switch and Switch game purchases to save that money for the Switch 2 instead.
Low game sales caused by “lack of big releases”
According to Nintendo, lower game sales this quarter were caused by a lack of big releases. This same reason could be part of why Switch unit sales were lower as well. Unlike last year, Nintendo didn’t have any major game launches. May 2023 saw the release of The Legend of Zelda: Tears of the Kingdom which helped drive sales of the Switch.
Nintendo didn’t have that benefit this time. With regard to the Switch 2, reports suggest it will be revealed prior to April of next year. Other rumors suggest that the hardware for the new Joy-Cons for that console could use magnets.
2024-08-03 15:06:13