Nintendo logs nine-month profit leap, upgrades annual forecast

TOKYO (AFP) – Japanese gaming giant Nintendo yesterday reported a leap in sales and profit for the nine months to December, upgrading its full-year profit forecast on strong demand for its popular Switch console.

Net profit for April-December rose 16.4 per cent from a year earlier to JPY196.4 billion (USD1.8 billion), with sales for the period up 2.5 per cent at JPY1.0 trillion, partially thanks to the start of sales in China through Tencent last December.

The Kyoto-based firm revised upward its full-year forecasts, now projecting a net profit at JPY210 billion for the fiscal year to March, compared with its earlier estimate of JPY180 billion. But it left its annual sales forecast unchanged at JPY1.25 trillion.

Sales of both its regular Switch platform and the Switch Lite – a smaller, cheaper version – are growing steadily with powerful titles, including the Pokemon series, though analysts are weighing the possible impact of the new coronavirus outbreak on production in China.

“Nintendo Switch Lite launched in September… and Nintendo Switch performed well without losing momentum, resulting in significant sales growth for the entire Nintendo Switch family,” the company said in a statement.

The Switch, launched in March 2017, has become a huge global seller, helped by innovative, family-friendly titles that have wowed critics and gamers alike.

“Sales of both software and hardware remain steady as Nintendo rode out the key Christmas shopping season,” Analyst Hideki Yasuda at Ace Research Institute in Tokyo, told AFP before the announcement.

But it remains to be seen what the effects will be of the new coronavirus that has killed 170 people and hit Chinese operations of global manufacturers.

“It’s a totally unexpected negative factor, which will affect Nintendo’s production in the fourth quarter to some extent,” Yasuda said.

“But the impact may be limited as Nintendo has a production base in Vietnam as well,” he added.