Nintendo Announces Financial Results For Second Quarter Of 2022 Fiscal Year

Nintendo issued their results for the third calendar quarter of 2022 (the second quarter of their 2022-23 fiscal year) overnight, including first official sales details for Splatoon 3 and Xenoblade Chronicles 3.

All financial indicators reported in yen, with an approximate dollar value based on current market rates of US$1 = 146.238 yen provided for comparison.

Financial Indicators

Operating income: 118.74bn yen (approx. $812m), down 0.9% year over year

Ordinary income: 155.741bn yen (approx. $1.065b), up 17.5% year over year (due to weaker yen)

Revenue: 349.514bn yen (approx. $2.39bn), up 7.7% year over year

Digital sales: 99.8bn yen (approx. $682m), up 20.4% year over year

Mobile revenue: 12.6bn yen (approx. $86.1m), down 3.9% year over year

Hardware Shipments

Total: 3.25m OLED: 2.01m Standard: 910,000 Lite: 330,000

The new LTD total is 114.33m Switches – with combined shipments of 4.36m in the current quarter, the Switch will pass the Game Boy (Color)’s 118.69m to become the second highest selling platform in company history behind the DS. Based on previous precedent, the pass will happen sometime in the current quarter; the lowest holiday quarter ever for Switch sales was the launch year 2017 at 7.01m systems.

The OLED made up roughly 61.8% of Switch shipments in the quarter, buoyed by the Splatoon 3 special edition system being an OLED model. The special edition for Pokemon Scarlet and Violet also being an OLED system may affect the percentage slightly for the holiday quarter, though Nintendo’s bundle for the holiday season is a standard Switch.

New Release Sales

Nintendo’s three major retail releases for the period were Live a Live (outside Japan only), Xenoblade Chronicles 3, and Splatoon 3. Live a Live did not ship 1m units internationally, but Splatoon 3’s record opening weekend in Japan translated to opening quarter shipments of 7.9m copies (5.08m in Japan, 2.82m internationally) while Xenoblade 3 opened to a 1.7m quarter. Splatoon 3’s opening quarter sales more than doubled Splatoon 2’s, while Xenoblade Chronicles 2 shipped just over a million copies in its first quarter.

Catalogue Sales

Nintendo Switch Sports shipped 1.31m copies in the quarter for a new lifetime total of 6.15m, while Kirby and the Forgotten Land added another 740,000 copies shipped to move to a lifetime total of 5.27m copies and become the best selling Kirby game ever. Mario Kart 8 Deluxe shipped another 1.59m copies in three months to move to 48.41m, while Animal Crossing New Horizons moved 790k copies to become the Switch’s 2nd 40+m selling game (40.17m). Ring Fit Adventure passed Pokemon Let’s Go Pikachu/Eevee lifetime sales in the period as well. (Full Switch top 10 sales can be found here.)

Other News

Nintendo made some modifications to their financial forecast for the year: revenue from 1.6t yen to 1.65, ordinary profit (including currency exchange) from 480b yen to 560b yen, and primary currency conversions being revised from 115y to 1 USD and 125y to the Euro to 135y for both currencies. Hardware shipments were actually revised downward to 19m systems (from 21m) due to the semiconductor shortage only abating slightly.
Four of Nintendo’s European branches – Germany, France, Belgium/Netherlands/Luxembourg, and Spain/Portugal – will be consolidated into one by the end of August 2024 in an effort to streamline operations in the region. The branch will be based out of Germany, though no employee job losses are necessary.
Nintendo will form a joint venture company with DeNA – who they originally teamed with for the creation of the Nintendo Account and mobile games in 2016-17 – beginning in April 2023, with the stated goal of “operations to strengthen the digitalization of Nintendo’s business, in addition to the creation of value added services”. Nintendo will own 80% of “Nintendo Systems Co. Ltd.” with DeNA holding the other 20%.