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

Nintendo's hardware sales forecast takes another hit, as Switch console and game sales fall short of projections. For the first nine months of the fiscal year, dedicated game console sales plummeted 31.7% year-over-year to ¥895.5 billion (approximately $5.7 billion), reflecting decreased sales of both the Switch and its software. Mobile and IP-related revenue also experienced a significant decline of 33.9% year-over-year, reaching ¥49.7 billion (approximately $320 million), primarily due to the challenging comparison with 2023's highly successful The Super Mario Bros. Movie. This resulted in a 27.3% year-on-year drop in gross profit to ¥565.5 billion (approximately $3.6 billion).

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Nintendo has further revised 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 magnitude surpasses Nintendo's initial predictions. Nevertheless, the Switch has achieved remarkable success, surpassing 150 million units sold. While overtaking the PlayStation 2's 160 million sales to become the best-selling console of all time might be challenging, the Nintendo DS's 154 million sales are within reach.

Nintendo characterized Switch and software sales during the third quarter (ending December 31, 2024) as "stable considering the platform's age." Overall Switch 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 including 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. Within its first 11 weeks (following its October 17, 2024 release), it outpaced sales of previous Mario Party titles for the Switch.

Crucially, active Switch users reached an all-time high of 129 million annual players in 2024, indicating sustained engagement despite the console's age. This bodes well for the upcoming Switch 2 launch.

Nintendo acknowledged the year-on-year decline in Switch unit sales but emphasized continued consumer interest, noting that sales in some holiday weeks exceeded those of the previous year.

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

The Switch 2 was also mentioned, with Nintendo reiterating its planned 2025 release and referencing the January 16th hardware reveal video. A dedicated Switch 2 Direct is scheduled for April 2nd, promising further details, along with hands-on events in various global cities.