Nintendo Posts Third Quarter Profits Amid Sliding Sales Revenue

Nintendo has posted their financial results for the third quarter FY 2017 ending December 31st, and as the company posted profit, the rest of the quarter was marked with mixed news. Nintendo’s Operating Income for the quarter was  26.3 billion yen, while net sales were 311.1 million Yen. This is actually down from the same period last year, with Q3 2016’s net sales equaling  425.6 million Yen. Regardless, Nintendo still predicts net sales of 470 million Yen by the end of the year, buoyed by the upcoming Switch console in March.

Overseas sales for Nintendo came out to  221.3 billion yen, or 71.2% of overall sales. Nintendo also saw a gain in  sales of investment securities totaling 63.5 billion yen thanks to the earlier sale of their stake in the Seattle Mariners, leading further to a profit attributable to owners of parent of 102.9 billion yen.

For software, 3DS titles like Pokémon Sun/Moon, Super Mario Maker for Nintendo 3DS, and Kirby: Planet Robobot reported positive sales. Pokémon Sun and Moon sold 14.69 million units worldwide, with 10.88 million copies sold outside of Japan alone. Kirby’s latest launched in June 2016 and has sold 1.32 million copies to date.

Super Mario Maker’s 3DS port saw a positive launch at 2.01 million copies sold since launch, having already sold over a million units in Japan. These figures can be attributed to the marketing push of Super Mario Run on mobile bringing further awareness of the brand. No million-selling Wii U games were cited for the quarter, not even the sole first party release from the quarter, Paper Mario: Color Splash.

Software sales for 3DS sat at 46.78 million units, a 20% increase from the same time 2016. Wii U software sales saw a 45% decrease from last year with 12.48 million units sold.  Digital software sales were also down drastically, going from 30.5 billion yen in revenue to 23.1 billion yen in 2017.

On the hardware side, it was the 3DS family of systems that came out on top, while Wii U continued its downward spiral and the NES Classic Edition suffered from shortages. The 3DS family sold 6.45 million units for the period, a 10% increase from last year, while Nintendo cited the 2DS as having an increased sell-through for the quarter.

The Wii U sold 75% less units from last year, only moving a meager 760,000 units out of the 800,000 units shipped for the fiscal year. Nintendo has already confirmed that Wii U production has ended worldwide, making room for the upcoming Switch. First party game sales, the only figure Nintendo provided, were also down from last year, a consequence of fewer games released.

Amiibo, Nintendo’s toys-to-life figures, also saw a downward trend in sales. The figures only moved 6.5 million units and amiibo cards moved 6.6 million units. Comparatively, amiibo figures sold 20.5 million units for the same period last year, back when the Super Smash Bros. series figures provided more momentum for the product line.

The NES Classic Edition, a popular holiday item suffering from shortages worldwide, sold 1.5 million units worldwide in the quarter. Nintendo explained the shortages in that “some parts require time to procure”, but they plan to increase production.

As previously stated, Super Mario Run on mobile was downloaded 75 million times on iOS, but only 5% of users paid to unlock the full content. This translates to $90 million in revenue. Mario Run also led to an increase in Nintendo’s Smart Device revenue from previous quarters.

In short, Pokémon kept Nintendo afloat during the last quarter while hardware and net sales were below expectations. By the end of their 2017 fiscal year, the fourth quarter will see the releases of their new Fire Emblem Heroes F2P app and the Nintendo Switch, the latter of which is widely expected to generated renewed sales interest among consumers.

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Editor-in-Chief (Former)

A man with a plan. My favorite video game franchise is Pokemon, but his favorite video game is Resident Evil 4. I can also tell you trivial cartoon factoids.