Technology

Nintendo Ups Profit Outlook On Robust Switch Sales

While Wii U was seen as something like the end of the game for Nintendo, Switch has fueled new life into the company. Since the release of Switch in March, the stock price of the company has increased double-fold touching the nine-year high. The Switch has surely worked wonders for Nintendo, and the same now reflects in the sales outlook released by the company while reporting fiscal second-quarter earnings on Monday, according to Reuters.

Nintendo Switch sales
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Rising Switch sales forecast

For the quarter-ended in September, the Japanese gaming giant reported better than expected revenues and operating profit. Nintendo posted a revenue of 219.9 billion yen ($1.9 billion), compared to the analyst’s estimate of 174 billion yen. Operating profits came in at 23.7 billion yen against the consensus estimate of 19 billion yen.

Looking forward, Nintendo forecasts a profit of 120 billion yen ($1.06 billion) for the year ending in March, an upward revision from 65 billion yen estimated three months ago. The new estimates still fall short of Thomson Reuters Starmine SmartEstimate of 133.60 billion yen (based on the projections of 22 analysts).

For the full year, Nintendo also raised its Switch sales number to 14 million units from 10 million units. “We’ve boosted Switch production in order to meet strong demand from our customers as it was difficult for customers to buy the consoles at retail stores,” said Nintendo President Tatsumi Kimishima on Monday.

Can easily Wii U this year

The size and importance of the Switch sales number from Nintendo can be well understood in light of the Wii U performance. In its entire shelf life, Wii U sold 13.56 million consoles. On the other hand, in just six months, Switch sales have already attained the figure of 7.63 million. This Switch sales number is sans Super Mario Odyssey, Black Friday and the awaited Christmas holidays.

Provided Nintendo settles its supply issues, Switch sales could easily surpass Wii U lifetime sales in its first year on the market. Nintendo Switch’s popularity can be owed to the fact that it offers the convenience of playing at home, as well as, on the go. According to NST.com, Hideki Yasuda, an analyst at Ace Research Institute in Tokyo said, “Switch is in excellent shape as sales of both hardware and software are growing steadily.”

Between April and September, Nintendo launched several titles for Switch such as Mario Kart 8 Deluxe and popular title Splatoon2. The Super Mario Odyssey is out now, and is expected to amplify sales in the second half according to Nintendo.

Competition also rising

As the Holiday season kicks in, the Switch will see increased competition from the likes of Microsoft as the company launches its high-resolution and high-powered Xbox One X on Nov. 7. Nintendo knows this. “The true power of the Switch would be tested during the upcoming holiday season,” said Kimishima.

Nintendo will also receive tough competition on the games front from popular titles such as Ubisoft’s Assassin’s Creed: Origins and Bethesda Softworks’ Wolfenstein II: The New Colossus, which released the same day as Nintendo’s flagship holiday game. And, Activision’s Call of Duty: WWII will be out soon.