Nintendo cuts profit and revenue outlook as its Switch console missed sales targets towards the end of the year.Nintendo cut its full-year earnings and revenue outlook, underscoring uncertainty around its aging Switch console and the global gaming environment.
The Kyoto-based company said it missed its targets for console sales toward the year’s end, while foreign currency volatility also played a role. It now expects operating income of 480 billion yen for the year ending March, down from 500 billion yen previously. It’s projecting net sales of 1.6 trillion yen, down from 1.65 trillion yen.
Many investors had expected the company to increase its guidance thanks to twin games Pokémon Scarlet and Pokémon Violet, which became the fastest-selling Nintendo games in the company’s history. The company reported operating profit of 190.2 billion yen and sales of 638.2 billion yen in the December quarter, both weaker than average estimates.
“The outcome was weak and that’s a surprise. The year-end holiday season suggested sales of hardware weren’t that strong despite amplified supply, which also weakened sales of software, Toyo Securities analyst Hideki Yasuda said. “It’s now clear that the Switch’s momentum is downward.