With Nintendo Switch 2 Waiting in the Wings, Sales of the Original Switch and Its Games Continue to Tumble

Nintendo's hardware sales forecast has been revised downward again, as Switch console and game sales fell short of projections. For the first nine months of the fiscal year, dedicated game console sales dropped 31.7% year-over-year to 895.5 billion yen (approximately $5.7 billion), reflecting decreased sales of both the Switch and its software. Mobile and IP-related revenue also declined by 33.9% year-over-year to 49.7 billion yen (approximately $320 million), primarily due to a tough comparison with the highly successful 2023 film, The Super Mario Bros. Movie. This resulted in a 27.3% year-over-year decrease in gross profit to 565.5 billion yen (approximately $3.6 billion).

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Nintendo has further lowered its financial forecast for the fiscal year ending March 2025, marking the second consecutive downward revision. The company anticipates even lower Switch hardware sales, reducing its projection by 1.5 million units to 11 million, and software sales by 10 million units to 150 million.

While sales declines were expected for the eight-year-old Switch, the drop is steeper than Nintendo initially predicted. Nevertheless, the Switch has surpassed 150 million units sold, a remarkable achievement. While surpassing the PlayStation 2's 160 million sales to become the best-selling console of all time may be unlikely, the Nintendo DS's 154 million sales are within reach.

Nintendo characterized Switch and software sales in its third quarter (ending December 31, 2024) as "stable considering the platform's age." Overall Switch family sales were down 30.6% year-over-year at 9.54 million units, and software sales decreased by 24.4% year-over-year to 123.98 million units. However, Nintendo highlighted strong sales of new titles: The Legend of Zelda: Echoes of Wisdom (3.91 million), Super Mario Party Jamboree (6.17 million), Mario Kart 8 Deluxe (5.38 million), and Nintendo Switch Sports (2.63 million) during the quarter. Mario & Luigi: Brothership also sold 1.4 million units.

Super Mario Party Jamboree stands out as a significant success. In its first 11 weeks (following its October 17, 2024 release), it outperformed previous Mario Party titles on the Switch.

Crucially, for Nintendo's upcoming Switch 2 launch, the number of active Switch players remains high, with 129 million annual active users in 2024. This indicates continued engagement despite the console's age.

Nintendo acknowledged the year-over-year decline in Switch unit sales but emphasized continued consumer interest, with some holiday weeks exceeding sales from the previous year.

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In light of the financial report, investors will eagerly anticipate the Switch 2's release. Nintendo confirmed upcoming releases for the original Switch: Xenoblade Chronicles X: Definitive Edition (March 20th), and Pokémon Legends: Z-A and Metroid Prime 4: Beyond (both in 2025).

The Switch 2 was also mentioned, with Nintendo reiterating its 2025 release date and referencing a January 16th hardware reveal video. A dedicated Switch 2 Direct is planned for April 2nd, along with hands-on events worldwide.