Image: Nintendo Life / Damien McFerran
Nintendo has released its financial results for the three months ending June 2022, reporting a loss in operating profit and a drop in both hardware and software sales.
In terms of its net sales, Nintendo reported a total of 307.4 billion yen, which was down 4.7% year-on-year. Specifically, hardware sales totaled 3.43 million units, representing a 22.9% year-on-year drop, while software sales totaled 41.41 million units, a drop of 8.6% year-on-year.
Nintendo’s mobile business also took a bit of a hit, with revenue from smart device content declining year-over-year, which was down 16.8% to a total of ¥10.9 billion.
Operating profit fell 15.1% to 101.6 billion yen, but net profits rose 28.3% to a total of 118.9 billion yen. Nintendo says this is partly due to foreign exchange gains of 51.7 billion yen from the depreciation of the yen at the end of the first quarter compared to the same period last year.
Considering the reasoning behind the overall decline in sales, Nintendo points out that the semiconductor shortage has significantly affected its production line and the company has been unable to carry out production as planned. This means that fewer units were shipped during the period, resulting in a decrease in sales.
Nintendo recently stated that it currently has no plans to raise the price of the Nintendo Switch in its native Japan due to the weak yen, contracted with many other electronics companies such as Apple.
Read more: Nintendo rules out any Switch price hike in Japan… For now
So should we be worried? Well, no, not really. Nintendo blames much of its sales decline on a shortage of semiconductor components, but says it expects availability and procurement to gradually pick up over the course of the late summer into fall/autumn. It says it will take advantage of the right shipping means to make sure as many Switch consoles are delivered to regions in preparation for the holiday season.
Plus, of course, the coming months include a number of high-profile releases, including Splatoon 3, Bayonetta 3, and Pokemon Scarlet and Violet. Nintendo reconfirmed the release windows for its next major titles as part of its financial update.
Read more: Nintendo reconfirms Windows launch for upcoming major Switch games
So what do you think of the sales drop that Nintendo has reported? Do you think its fortunes will change as the availability of semiconductors improves? Share your thoughts in the comments below.