Nintendo Sales Slow Down as Switch Enters it’s Seventh Year in Production
In recent years, Nintendo has been experiencing a decline in its sales, especially for the Nintendo Switch. We all know why it’s happening, as you can’t expect something that’s six years old, making the headlines, topping charts.
The company announced that it had sold 125.62 million Switch consoles as of March 31, which, surprisingly is a slight increase compared to the previous year. However, year-end console sales have declined by 22%. Nintendo had set a sales target of 21 million consoles for the year but ended up selling only 17.97 million consoles.
The company expects to sell only 15 million consoles in the current fiscal year, which represents a further 16.5% decline.
The president of Nintendo, Shuntaro Furukawa, has admitted that it will be difficult to sustain the Switch’s sales momentum in its seventh year since launch. This is why the company’s goal is to have more consumers continue to play Nintendo Switch for longer to maximize sales. However, despite their high ambitions, Nintendo is not confident in hitting its next 15 million target, according to Furukawa.
With this in mind, it is still surprising to a lot of people why Nintendo is not looking to launch their next hardware, as the gap between the last gen is huge (seven years almost, and we still don’t know when the Switch 2 is expected).
The reason for writing this is that the company has suggested that it will not release any new hardware before April 2024. This means that the existing Switch models will be the only options for consumers for some time. We saw two big game releases during this fiscal year, Splatoon 3 and Pokémon Scarlet and Violet, both of which reported strong sales of a combined 32.77 million copies, hardware sales have not picked up as expected.
The hugely popular and anticipated The Legend of Zelda: Tears of the Kingdom is set to release this week, but many analysts believe that people aren’t exactly looking to buy half a decade old hardware just to play their favorite latest games on it.
The company said that the decline in Switch hardware is due to a shortage of semiconductors that impacted production until around late summer and a more flat holiday sales season compared to the previous year. However, Switch software sales remain strong, with the company selling 213.96 million units for the fiscal year, a decline of only 8.9% compared to the previous year.
The decline in sales has also affected Nintendo’s profits, with the company reporting that its net sales were down 5.5% at $12.56 billion, and net profit was down 9.4% at $3.2 billion for the fiscal year 2023. As a result, Nintendo’s valuation is very likely to keep on shrinking until the launch of the new hardware.
With this, we can very clearly see that it’s not Nintendo that wants to delay the upcoming console, but rather, unlike many releases we have seen in the past, they want their product to be full ready before starting production.
While this is all we know for now, rest assured that we will keep you updated as new information becomes available.