With Nintendo Switch 2 Waiting in the Wings, Sales of the Original Switch and Its Games Continue to Tumble

Nintendo's hardware sales forecast has been revised downward again, as Switch console and game sales fell short of projections.

For the first nine months of the fiscal year, Nintendo's dedicated video game console business saw a 31.7% year-over-year decrease in sales, reaching 895.5 billion yen (approximately $5.7 billion). This decline stems from lower sales of both the Nintendo Switch and its software.

Mobile and IP-related revenue also experienced a significant drop, falling 33.9% year-over-year to 49.7 billion yen (approximately $320 million). This is primarily attributed to the challenging comparison with the highly successful 2023 release of The Super Mario Bros. Movie.

Consequently, gross profit decreased by 27.3% year-on-year to 565.5 billion yen (approximately $3.6 billion).

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Nintendo has further lowered its financial forecast for the fiscal year ending March 2025, marking the second consecutive downward revision. The company anticipates even lower Nintendo Switch hardware sales, reducing its projection by 1.5 million units to 11 million, and software sales by 10 million to 150 million.

While sales declines were expected for the eight-year-old Switch, the drop is steeper than Nintendo initially predicted. Nevertheless, the Switch has achieved remarkable success, surpassing 150 million units sold. While overtaking the PlayStation 2's 160 million sales to become the best-selling console of all time may be unlikely, surpassing the Nintendo DS's 154 million sales remains a possibility.

Nintendo characterized Switch and software sales in its third quarter (ending December 31, 2024) as "stable, considering the platform's eighth year."

Overall sales for the Nintendo Switch family of systems were down 30.6% year-on-year at 9.54 million units. Software sales declined by 24.4% year-on-year to 123.98 million units. However, Nintendo highlighted strong sales of several new titles during the quarter: The Legend of Zelda: Echoes of Wisdom (3.91 million), Super Mario Party Jamboree (6.17 million), Mario Kart 8 Deluxe (5.38 million), and Nintendo Switch Sports (2.63 million). Mario & Luigi: Brothership also sold 1.4 million units.

Super Mario Party Jamboree stands out as a particular success. In its first 11 weeks (following its October 17, 2024 release), it outperformed previous Mario Party titles on the Switch.

Significantly, the number of active Switch players remains high, with 129 million annual playing users in 2024. This indicates continued engagement despite the console's age.

Nintendo acknowledged the year-on-year decline in Switch unit sales but emphasized that the console continues to attract consumers, with some holiday weeks exceeding sales from the previous year.

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Given the latest financial report, investors will eagerly anticipate the Switch 2's release. Nintendo confirmed upcoming Switch titles: Xenoblade Chronicles X: Definitive Edition (March 20 release) and Pokémon Legends: Z-A and Metroid Prime 4: Beyond (scheduled for 2025).

The Switch 2 was also mentioned, with Nintendo reiterating its planned 2025 release and referencing the January 16th hardware reveal video. A dedicated Switch 2 Direct is planned for April 2nd, along with hands-on events globally.