Nintendo's Q1 Profits Plummet 55% as Switch Console Nears End of Lifecycle

Nintendo has reported a substantial decline in sales and net profit for the first quarter of FY2025, marking the eighth year since the release of the Nintendo Switch console. The company saw declines across all segments, attributing this to a relatively quiet Q1 2025 release schedule compared to the same period last year, which saw the launch of The Legend of Zelda: Tears of the Kingdom. For the three months ended June 30, 2024, key figures include: net sales of ¥246.6 billion ($1.6 billion), down 46.5% year-on-year; net profit of ¥80.9 billion ($542.9 million), down 55.3% year-on-year; hardware sales of 2.1 million units, a 46.3% decline; and software sales of 30.6 million units, a 41.3% decrease. Sales on Nintendo's platforms were down 46.4% to ¥229 billion ($1.5 billion), including hardware, software, and accessories, while mobile and IP-related sales fell 53.8% to ¥14.7 billion ($98.6 million). The decline in hardware and software sales was attributed to the lack of major releases during Q1 2025, as well as the Switch console being in its eighth year since launch. Hardware sales for the Switch family dropped 46.3% year-on-year to 2.1 million units, with the OLED model selling the most at 1.24 million units, although this was down 56.1% compared to the previous year. Software sales declined 41.3% year-on-year to 30.64 million units, with notable sales including Paper Mario: The Thousand Year Door at 1.76 million units and Luigi's Mansion 2 HD at 1.19 million units. Digital sales accounted for over half of total software sales on Switch during Q1 2025 but fell 32.6% year-on-year. Despite this, Nintendo stated that sales of download-only software and Nintendo Switch Online revenue remained stable, resulting in an increased proportion of digital sales. The company highlighted that 74.2% of sales were made overseas, with 44.8% in the Americas, 25.8% in Japan, and 21.3% in Europe. Looking ahead, Nintendo announced no changes in its expectations for the full year.