June 30, 2022 Nintendo Quarterly Financial Update

By LUDWIG VON KOOPA - Finally! Negative numbers!

Just to be clear, I'm not rooting for Nintendo to have a worse performance than before. But at least it's something new to talk about, and it finally disproves the idea that this company can just infinitely grow.

How bad are we talking? 4.7% reduction in net sales compared to the June 30, 2021 update. ...Now, to be fair, the June 30, 2021 update itself had even more negative numbers than this one. But that's because June 2021 was comparing to June 2020, which means it was comparing to Animal Crossing: New Horizons being a cultural icon at the start of the Chinese Communist Party Virus pandemic. That's a tough compare. But the reason 2022 is lower than 2021 is because of “the global shortage of semiconductor components, resulting in a decrease in hardware shipments and subsequent decline in overall sales.” While Nintendo didn't outright say this, I think it's implied that if there wasn't a semiconductor shortage, then Nintendo Switch demand would still be quite robust and high. (And, you know, not necessitating a major new 4K-based hardware revision.)

Nintendo isn't changing their FY23 (or fiscal year that ends March 2023) forecast, since they acknowledged that semiconductors would be in short supply when devising it. Nintendo only shipped 3.43 million Switch family systems (1.32 million normal Switch, 1.52 million (OLED model) Switch systems, and a paltry 0.59 million Switch Lite handhelds) from April 1 to July 30 2022. This is the second time that the Nintendo Switch (OLED model) has outsold the normal Nintendo Switch in a quarter—it was 1.81 OLED versus 1.77 regular in the last quarter of last fiscal year (or January 1 to March 31 2022). I wonder how much of that 1.81 number would be added to the 1.77 number if the (OLED model) didn't exist. (Reminder that Nintendo says the (OLED model) has a lower profit margin compared to the other Switch models.)

How about some software?

I had to chop off some of the games from appearing on this chart, or else the new titles wouldn't appear.
Ring Fit Adventure is still the 10th best selling Switch game.

Only four Nintendo Switch games sold over a million copies between April to June. They were all published by Nintendo: Nintendo Switch Sports (4.48 million), Mario Strikers: Battle League (1.91 million), Kirby and the Forgotten Land (1.88 million for 4.53 million total), and Mario Kart 8 Deluxe (1.48 million more). Now THAT'S weaker than before (and total software sold in the period fell 8.6% year-over-year). That said, Kirby and the Forgotten Land has not only outsold Kirby Star Allies, but it's also the best-selling Kirby title since the Wii and Nintendo DS (and possibly ever, though they haven't been collecting that data before that...somehow?), according to Nintendo's presentation. And Nintendo Switch Sports has outsold the lifetime total for 1-2-Switch.

Nintendo still refuses to say how many people are subscribed to Nintendo Switch Online + Expansion Pack, just that some people are. The Expansion Pack was introduced at the end of October 2021, so it'll still be some time before we learn if people will actually renew that. (It's only sold in yearly increments, unlike a normal Nintendo Switch Online subscription.)

If it makes you feel better, Advance Wars 1+2: Re-Boot Camp still has a Launch Date of “TBA”, as does Metroid Prime 4. (As opposed to being cancelled altogether and being off the list.) Coming up for the next update: How well Xenoblade Chronicles 3 sells, as well as Splatoon 3! And Nintendo thinks that semiconductors will become a bit more available as more time passes.


Do you think that Mario Strikers: Battle League will ultimately outsell the likes of Mario Tennis Aces? Will Xenoblade Chronicles 3 be the best-selling game of its series? Maybe the semiconductor shortage will continue to mess things up? What do you think?


The previous quarter's update also covered a whole fiscal year, too: March 31, 2022!
Here is the next quarter's update, which includes an additional briefing's worth of analysis.