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Image: Nintendo Life

After the dizzying highs of the 2020/2021 financial year, the most recent financial results from Nintendo show an expected but relatively modest drop following the pandemic / lockdown-related boom. The results are still very strong, yet we're now into the sixth year of the Switch generation; as such Nintendo is forecasting an upcoming year of declines to match the older hardware.

First, let's summarise the key figures for 2021/2022, with percentage indicators in brackets for how they compare to the previous financial year.

Net Sales
1695.3 billion Yen / approx $13 billion USD [-3.6%]
Operating Profit
592.7 billion Yen / approx $4.56 billion USD [-7.5%]
Net Profit
477.6 billion Yen / approx $3.67 billion USD [-0.6%]

Switch Hardware Sales - 23.06 million [-20%]

Switch Software Sales - 235.07 million [+1.8%]

Nintendo has cited the global chip shortage as a factor in the reduced hardware sales; the company had to reduce previous projections earlier in the financial year due to the issue. Software sales actually being up does show the continuing demand for the system and its games in a particularly positive light.

As we've mentioned, though, Nintendo is forecasting 2022/23 to be a down year across the board; below are its estimates across the same areas, with the percentage showing the expected declines compared to the most recent results (2021/2022).

Net Sales
1600 billion Yen / approx $12.3 billion USD [-5.6%]
Operating Profit
500 billion Yen / approx $3.84 billion USD [-15.6%]
Net Profit
340 billion Yen / approx $2.61 billion USD [-28.8%]

Switch Hardware Sales - 21 million [-8.9%]

Switch Software Sales - 210 million [-10.7%]

While profits in the billions and over 20 million systems sold will be considered a positive on many metrics, the momentum is undeniable. There's little doubt that investors will be eager to know how the company plans to level out and start increasing sales and profits once again; yes, that'll lead to chatter about new generation hardware as the Switch slows down.

The software sales is also an interesting number, showing that Nintendo doesn't expect its line-up for the coming year to hit the same heights. This is perhaps understandable with two Pokémon releases (Scarlet and Violet) instead of three, and with Breath of the Wild 2 being delayed to either just before the end of the financial year next March, or potentially falling later in the Spring and missing the financial year entirely. We'd suggest these forecasts perhaps make a huge-selling upgraded system and Breath of the Wild 2 longshots for before 31st March 2023, but it's Nintendo so who knows.

The coming year could be all about maintaining Switch popularity, consolidation and preparing foundations for bigger years to come; it wouldn't surprise us if Nintendo pitches a similar line to investors, in any case.

[source nintendo.co.jp]