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Tuesday, May 9, 2023

Nintendo's Results For Fiscal Year Ended March 2023

By LUDWIG VON KOOPA - Are we now entering swan song territory?

It is the fun part of the year where Nintendo has completed their fiscal year (abbreviated as FY23, which ended March 31, 2023) and is now reporting on how that went. And the top-line results, year-over-year, are all worse than FY22. (We talked about last year's results last year. See the link below the italicised footer.) FY22 was, itself, a year of decline compared to the year before that, and Nintendo said from the beginning that they'd expect FY23 to be a year of further decline. Less profit, less sales, higher expenses across the board.

Compared to the initial consolidated financial forecast made one year ago for how FY23 would turn out (but note that forecast has changed several times since then), Nintendo was spot-on or better regarding their sales and profit figures. That said, they did expect to sell 21 million hardware units and 210 million software units, and they actually sold 17.97 million hardware units and 213.96 million software units. For FY24, they are now projecting they'll sell 15 million Nintendo Switch units and sell 180 million software units. Their basic strategy remains unchanged: Continue with some new titles, sell more of their already-released games, and hope more people are like Masahiro Sakurai and purchase multiple Switch consoles in their household.

They did sell a lot of a few new games, though, like Pokémon Scarlet, Pokémon Violet, Splatoon 3, and Nintendo Switch Sports. But just not as much first-party games as, say, the year before or the year before that. For this year, their plans are based on The Legend of Zelda: Tears of the Kingdom (including its OLED model), with a side of Pikmin 4 and downloadable content for games like Pokémon Scarlet, Pokémon Violet, and Mario Kart 8 Deluxe. Maybe Advance Wars 1+2: Re-Boot Camp will sell well. And Metroid Prime 4 is still TBA.

Nintendo Switch million selling software March 31 2023 fiscal year Ring Fit Adventure New Super Mario Bros. U Deluxe
See the little olive dot over the top Ring Fit Adventure? That's a sudden bump from New Super Mario Bros. U Deluxe.

Some games barely sold anything at all between January 1 and March 31, 2023. Granted, it's a weak period for game sales, but Bayonetta 3 selling only 30,000 copies or Xenoblade Chronicles 3 selling only 50,000 copies during that time doesn't say much for those games’ evergreen potential. Somehow, New Super Mario Bros. U Deluxe has jumped up to have more copies sold than Ring Fit Adventure for the first time in two years. PERHAPS IT'S BECAUSE OF THAT PESKY PLUMBER'S MOVIE. (Which technically wasn't even released by the time this data was closed. Compare April 5 to March 31.) Clearly, we need a Ring Fit Adventure movie. At least it's still in the top ten.

Nintendo hardware software percentage change every fiscal year portable console Switch Wii U 3DS
This represents year-over-year percentage changes for various Nintendo consoles and handhelds' hardware and software sold.
Remember: the Nintendo Switch still grew. It just grew at a slower rate than last year.
Compared to last year, I added the 10th and 11th fiscal year results for the Wii U, and the 10th through 13th for the 3DS. (Software only. Hardware was 0 units.)
The Nintendo Switch now has numbers for its seventh fiscal year. You can see there is a decline.
Interestingly enough, it looks like 3DS software actually went up in the end thanks to the 3DS eShop last-chance sales.
But no one cared about the Wii U's.

Nintendo has been saying since September 2020 that the Nintendo Switch is at the “middle of its lifecycle”, which ought to put the end of the second half of the lifecycle around this time next year (2024). And when one hardware ends its lifecycle, that means another hardware will begin its lifecycle. That's not me being an obnoxious FAKE NEWS rumour-peddling “journalist”, that's just how the math around midpoints work. I'm not saying that a next Nintendo hardware WILL come out a year from now. But that's when it's reasonable to expect news or information or a release based on Nintendo's words.

Personally, I'm not quite ready for a new Nintendo hardware to come out. I'm still hoping they'll add in communication features to let one Switch owner send a message to another Switch owner they are friends with. That's unlikely to happen at this part of the lifecycle, but who knows?!

The English translation of the question and answer session Nintendo should've had with analysts and investors following the financial disclosure should be available later this week. KoopaTV plans to have an article about the session next week. Feel free to comment here on anything that catches your interest, including if KoopaTV passed up on mentioning something as you go through your own reading of the financial documents.

Read 2022's graphs and textual result interpretation here.
FY23 third quarter's results (the quarter before this one, Q4, which also covers the whole FY23) is over here, featuring some of those revised targets.
The English translation of that Q&A session is available, and KoopaTV analysed both sides here.

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