Nintendo has reported its third quarter FY 2021 financial results and things are looking fantastic for the video game behemoth. For the first 9 months of the fiscal year (April 1, 2020 – December 31, 2020) the company brought in 1404.4 billion yen, up 37.3% over the prior year. Operating profit was 521.1 billion yen (up 98.2% YoY), ordinary profit was 528.2 billion yen (up 92.9%) and net profit was 376.6 billion yen (up 91.8%).
The vast majority of the sales and profit came from Nintendo’s dedicated video game platform (the Switch and its games and accessories). Mobile and other intellectual property related income generated 42 billion yen, up 13.8%, and playing cards, etc. added another 1.3 billion yen (down 38.1%).
Given that Nintendo had such a massive holiday quarter, and with only one quarter remaining in FY 2021 (Jan. 1 2021 – Mar. 31, 2021), they’ve once again had to raise their estimates for the rest of the reporting period. They had forecast 1400 billion yen for the entire fiscal year, and having already blown past it in just 9 months they’ve revised their target to 1600 billion yen. Originally they targeted 19 million Nintendo Switch consoles would be sold for the entire year. They had since revised that target up to 24 million, but now they’ve increased it once again to 26.5 million. Nintendo Switch software has likewise been revised upward from its original 140 million to the previously stated 170 million and now to the updated forecast of 205 million. A very good year indeed!
For the first 9 months of FY 2021 Nintendo has sold 24.1 million Nintendo Switch systems, up 35.8% from 17.74 million during the same reporting period last fiscal year. Software is up even more with a 43% increase year-over-year having sold 176.1 million pieces this fiscal year compared to 123.13 last year. The number one selling game from April 1, 2020 – December 31, 2020 was Animal Crossing: New Horizons with 19.41 additional copies sell-in (shipped to retailers and sold via e-Shop). In all, 29 titles for the Switch have sold over a million copies, including 20 from Nintendo and 9 from third parties.
Like the rest of the video game industry, Nintendo has seen huge increases in its digital game sales. That’s partly due to the Covid-19 worldwide pandemic and people staying home and buying games through the Switch instead of going out to retailers. Also, the trend has been pointing to digital over the past few years due to convenience and the fact that thousands of smaller games are only available digitally and not at brick and mortar locations. Compared to a year ago, digital sales made up 256 billion yen, up 104.9%. Put another way, 40.9% of all software sold was digital.
When we look at life to date software sales for the Nintendo Switch, we see that Nintendo has plenty of games that have sold over one million copies. Mario Kart 8 Deluxe is still holding onto first place with 33.41 million sold. It’s incredible that Animal Crossing: New Horizons, having released on March 20, 2020 and not even being on the market for an entire year has managed to sell an amazing 31.18 million copies. It has to be in the running for one of the fastest selling pieces of software of all time. The limited run of Super Mario 3D All-Stars is sitting at 8.32 million sold and both The Legend of Zelda: Breath of the Wild and Super Mario Odyssey are now sitting above the 20 million sold mark – and deservedly so since they remain two of the best games ever created. Also of note are Pokémon Sword and Shield, having amassed over 20 million sold – making them one of the most successful entries in the series.
Another record broken during this reporting period is that the Nintendo Switch has now outsold the Nintendo 3DS family of systems! The Switch, which has been on the market for almost four years, is sitting at just shy of 80 million sold, with 79.87 million worldwide. The 3DS, which has been on the market for nearly ten years, has 75.94 million sold. Software is also impressive with 532.34 million games sold for Switch when compared with 385.85 million 3DS games sold. In three months time when Nintendo reports its full year results, the Switch should have also passed up the total number of Game Boy Advance systems, which is sitting at 81.51 million, and it has already surpassed the number of games sold (the GBA only sold 377.42 million games).
Overall Nintendo is having a stellar fiscal year and one of its best years ever when it comes to sales and profit. If they can continue to execute on hardware production and keep the software pipeline full of exciting new products, then the Switch should continue to perform well in the marketplace. Competitors with more powerful machines have done little to slow Nintendo down and with shortages expected to continue with PS5 and Xbox Series X and S for the foreseeable future, Nintendo is primed to continue on its winning streak over the next year!
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