Nintendo Announces Third Quarter Operating Results

Nintendo announced its third quarter sales data, which combines the first 9 months of its fiscal year (April 1, 2016 through December 31, 2016). Its net sales (in millions of yen) were 311,211, down from 425,664 the year prior. This isn’t a huge surprise due to the lack of big name software released for the Wii U. Income from operations was 26,315, also down from last year. However, thanks in part to the huge success of Pokemon Go as well as the sale of the Mariners, Nintendo was able to post a profit of 102,969 million yen, the highest on record for the past five years.

 

 

Some sales highlights include Pokemon Sun & Moon, which Nintendo managed to sell 14.69 million copies. Super Mario Maker for Nintendo 3DS also surpassed 2 million sold. The number of 3DS hardware sold was 6.45 million systems, a 10% increase over last year. In addition, more games were sold for the 3DS in the past 9 months when compared to the prior period, with 46.78 million software pieces shifted (20% increase).

 

Life-to-date sales of 3DS software through December 31, 2016.

 

Wii U, which was expected to only sell .8 million actually sold .76 million. Software sales plummeted to 12.48 million, down 45% from the prior year.

 

 

To no one’s surprise, Nintendo also confirmed that Animal Crossing for smart devices has been delayed to its next fiscal year. This means it will not come out until sometime after April 1, 2017. With Fire Emblem Heroes launching in a few days and the Nintendo Switch sucking up all of the air for March, it was pretty obvious that the new Animal Crossing game would come later. No word on exactly when, but hopefully it will tie in with an unannounced Switch version sometime later in the year.

 

During the nine months ended December 31, 2016, the worldwide release of Pokémon Sun and Pokémon Moon generated buzz and led to blockbuster sales of 14.69 million units. In addition, Super Mario Maker for Nintendo 3DS surpassed the million-seller mark. The release of the smart device application Pokémon GO led to increased sales of software in the Pokémon series released in the past and drove Nintendo 3DS family hardware sales growth, particularly outside of Japan. The worldwide sales volume for Nintendo 3DS hardware this period was 6.45 million units (10% increase on a year-on-year basis), while Nintendo 3DS software sales were 46.78 million units (20% increase on a year-on-year basis).

On the other hand, for the Wii U console, we planned to ship 0.8 million units this fiscal year, based on our forecasts of comprehensive demand for Nintendo hardware. Activity has conformed to our expectations from the start of the fiscal year, with hardware sales volume of 0.76 million units (75% decrease on a year-on-year basis) and software sales volume of 12.48 million units (45% decrease on a year-on-year basis).

On the smart device front, we released Super Mario Run, a new action game featuring Mario, in 150 countries and regions on December 15 (Pacific Standard Time). This title elicited a fantastic response, surpassing 40 million downloads in four days after the release.

The Nintendo Entertainment System: NES Classic Edition also launched in Japan and overseas in November to widespread popularity. Although the release of some new titles offering amiibo functionality restored some momentum, amiibo sales remained limited to 6.5 million units for figure-type and 6.6 million units for card-type. In addition, there were relatively fewer offerings of downloadable content during this period, so digital sales were also down to a large extent on the same period last year.

Along with this background, resulting in an operating income of 26.3 billion yen against net sales of 311.1 billion yen (of which overseas sales were 221.3 billion yen or 71.2% of the total sales). We have also included 16.7 billion yen of share of profit of entities accounted for using the equity method related to The Pokémon Company and other investments, resulting in an ordinary income of 49.1 billion yen. In addition, due to the sale of part of our equity in the company that manages the Seattle Mariners Major League Baseball team, we recorded gain on sales of investment securities totaling 63.5 billion yen as extraordinary income, meaning that profit attributable to owners of parent was 102.9 billion yen.

2. Consolidated Financial Forecast

We will launch Nintendo Switch, a new home gaming system that diversifies the ways you can play video games, on March 3, 2017 in Japan and overseas. Our launch lineup includes first-party software such as The Legend of Zelda: Breath of the Wild and 1- 2-Switch as well as strong third-party titles. The Legend of Zelda: Breath of the Wild will release for Wii U on the same day.

For Nintendo 3DS, we aim to maintain the buzz surrounding the hit titles Pokémon Sun and Pokémon Moon and Super Mario Maker for Nintendo 3DS, as well as releasing new titles such as Mario Sports Superstars.

For smart devices, we plan to release the game application Fire Emblem Heroes on February 2. We will also follow last December’s release of Super Mario Run for iOS with an Android version in March. To accommodate the releases and operation of these applications, we have revised the release schedule for Animal Crossing, which we had originally planned to release during this period. This title will be released during the next fiscal year.

We have revised the financial forecast originally published on October 26, 2016. For details, see the Notice of Full-Year Financial Forecast and Dividend Forecast Modifications issued today (January 31, 2017).

 

[Source: Nintendo]

 

Craig Majaski

Craig has been covering the video game industry since 1995. His work has been published across a wide spectrum of media sites. He's currently the Editor-In-Chief of Nintendo Times and contributes to Gaming Age.

2 thoughts on “Nintendo Announces Third Quarter Operating Results

  • January 31, 2017 at 6:08 AM
    Permalink

    Good to see the company in the profits.

    Reply
    • January 31, 2017 at 8:26 AM
      Permalink

      Indeed! Continued success can result in more games coming to the market. Hopefully Nintendo Switch continues that trend.

      Reply

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