Nintendo reports Switch sales slowdown and suggests no new hardware this year

Nintendo has reported a slowdown in Switch hardware sales and suggested that no new hardware will release before April 2024.

The company has now sold 125.62 million Switch consoles as of March 31, up from 122.5 million, but year-end console sales have declined by 22%.

In its results for the end of its fiscal year, Nintendo confirmed it had sold a total of 17.97m consoles during the 12-month period, which means it missed its year-start sales target of 21m (and the later revised target of 18m).

The company forecasts it will sell 15 million consoles during the current fiscal year ending March 31, 2024, which represents a further 16.5% decline, as Switch enters a significant slowdown during its seventh year on the market.

“Nintendo Switch has entered its seventh year since launch, and while it will become more challenging to maintain the same sales momentum as before, our goal is to have more consumers continue to play Nintendo Switch for longer, leading to maximized sales,” the company said in a statement.

Speaking on a call after the results, president Shuntaro Furukawa reportedly suggested that amid slowing console sales, Nintendo isn’t completely confident in hitting its next 15 million target.

According to Bloomberg, Furukawa added that no new or upgraded hardware is factored into Nintendo’s annual forecast.

“Sustaining the Switch’s sales momentum will be difficult in its seventh year,” Shuntaro Furukawa said via Bloomberg. “Our goal of selling 15 million unit this fiscal year is a bit of stretch. But we will do our best to bolster demand going into the holiday season so that we can achieve the goal.”

THE BEST-SELLING SWITCH GAMES

*As of March 31, 2023 (compared to Dec 2022)

1. Mario Kart 8 Deluxe – 53.79m (+1.79m)
2. Animal Crossing: New Horizons – 42.21m (+0.62m)
3. Super Smash Bros. Ultimate – 31.09m (+0.55m)
4. Legend of Zelda: Breath of the Wild – 29.81m (+0.81m)
5. Pokemon Sword/Shield – 25.82m (+0.14m)
6. Super Mario Odyssey – 25.76m (+0.64m)
7. Pokémon Scarlet & Violet – 22.1m (+1.49)
8. Super Mario Party – 19.14m (+0.34m)
9. New Super Mario Bros. U Deluxe – 15.41 (+0.66m)
10. Ring Fit Adventure – 15.38m (+0.16m)

Switch’s sales slowdown comes despite two blockbuster releases during the fiscal year in the form of Splatoon 3 and Pokémon Scarlet and Violet, both of which reported strong sales of a combined 32.77m.

And with the much-anticipated The Legend of Zelda: Tears of the Kingdom set to release this week, some analysts don’t expect hardware sales to pick up in the way in which it has in the past.

“We expect Nintendo will not release the next-generation hardware over the next 12 months,” UBS Securities said in a note ahead of the earnings report. “Nintendo’s valuation is very likely to shrink until the launch of the new hardware.”

Last year Switch was already confirmed as the best-selling Nintendo home console of all-time, beating Wii’s 101.63m. However, it still has a way to go before it matches Nintendo DS’s 154.02 million units sold. Outside of Nintendo’s own consoles, only PlayStation 2 (155m) has outsold Nintendo Switch.

Switch has now shipped 1.036 billion games since it launched in 2017, which is more than any other Nintendo console (DS is closest at 948.7m games shipped).

In its results for FY23, the Japanese company said its net sales were down 5.5% at 1,695 billion yen ($12.56 billion), and net profit was down 9.4% at 432.7 billion yen ($3.2 billion)

The company attributed the Switch hardware decline partly to a shortage of semiconductors that impacted production until around late summer, and a more flat holiday sales season compared to the previous year.

Despite the hardware decline, Switch software sales remain strong at 213.96 million units for the fiscal year (down 8.9% year-on-year).

New entry Pokémon Scarlet and Violet shipped a huge 22.1 million copies in the 4.5 months up to March 31, 2023, while Splatoon 3 shipped 10.67m, and Switch Sports sold 9.60 million.

In addition, among the titles released through the end of the previous fiscal year, Fire Emblem Engage shipped 1.61m, Bayonetta 3 shipped 1.07m, Metroid Prime Remastered shipped 1.09 million and Mario Strikers: Battle League shipped 3.109 million.

“Looking ahead at software, in addition to The Legend of Zelda: Tears of the Kingdom in May, and Pikmin 4 in July, add-on content for Pokémon Scarlet and Pokémon Violet in the form of The Hidden Treasure of Area Zero is on the way,” the company said.

“The first part of this add-on content, The Teal Mask, is planned to be released in the fall of 2023, and the second part, The Indigo Disk, is planned for release in the winter of 2023.

“Other software publishers also plan to release a wide variety of titles, and we will work to invigorate the platform by supplementing existing titles with a continuous stream of new titles and add-on content.”