Mario Kart 8 Deluxe Switch
Image: Nintendo Life / Zion Grassl

In its Q3 financial results at the start of February Nintendo confirmed that it was increasing its forecast for software sales over the year from 200 million to 220 million units. While the runaway early success of Pokémon Legends: Arceus is certainly a factor in that, 'evergreen' older titles are still contributing many millions of sales each year, with Mario Kart 8 Deluxe being the prime example (to the point it now has a new two year DLC roll-out on the way).

Asked about the trend in an investor Q & A, however, company President Shuntaro Furukawa highlighted the impressive ongoing sales of 'evergreen' games but made it clear that this likely won't be sustainable in the coming years for the Switch. This'll be a natural evolution as the system's generation enters its latter years; with less 'new' owners picking up the system there'll be an equivalent drop in those picking up the highly rated and essential older titles.

The goal, of course, is to pick up any fall-off in evergreen sales with positive results for all-new experiences.

Evergreen titles that were released in previous fiscal years have made up a larger share of overall software sales since the last fiscal year. So far this fiscal year, in the nine months between April and December, titles released in past years comprised approximately 60% of unit sales for first-party software (sell-through, see Note) in major regions. Looking at only the three months between October and December, evergreen titles comprised approximately 50%, due to strong sales of new titles.

Regarding sales trends for evergreen titles, consumers who newly purchase Nintendo Switch hardware often choose to buy an evergreen title as their second or third game. In addition, as Nintendo Switch enters its sixth year, we believe there will be a decrease in the percentage of first-time purchases in terms of future demand for hardware, compared to what we have seen so far. We expect to see more purchases of multiple systems within the same household, as well as consumers replacing a previous Nintendo Switch system with Nintendo Switch – OLED Model. In these cases, consumers often already own the evergreen titles, so we believe that the ratio of evergreen title sales will decrease unless there is a major increase in first-time hardware purchases.

On the other hand, we believe that both first-time purchasers of Nintendo Switch and those who already own the hardware are interested in purchasing new titles. Going forward, it will be important to offer not only a variety of hardware but to also strengthen sales of both evergreen and new titles.

Even before inevitable additional Nintendo Direct broadcasts 2022 is already looking busy for the Switch, with fresh reveals and dates for the likes of Nintendo Switch Sports and Mario Strikers: Battle League, and '2022' windows for games like Mario + Rabbids Sparks of Hope, Bayonetta 3 and The Legend of Zelda: Breath of the Wild 2.

It'll be interesting to see how the line-up for the rest of this year, and of course 2023, shapes up in the coming months.