Nintendo lifts annual profit forecasts on strong game sales

TOKYO, Japan — Japanese gaming giant Nintendo raised its annual forecasts on Tuesday after strong first-half sales of its new "Zelda" and "Mario" franchise games for the ageing Switch console.

Helped by a weaker yen, Nintendo expects net profit to decline 3.0 percent to 420 billion yen ($2.8 billion) for the 12 months to the end of March, up from a previous estimate of 340 billion yen.

Operating profit is now expected to be roughly flat at around 500 billion yen, up from a previous projection of 450 billion yen, while sales will dip 1.4 percent, according to the new forecasts.

"Each title released this fiscal year has sold well, with 'The Legend of Zelda: Tears of the Kingdom' posting sales of 19.50 million units, and 'Pikmin 4' posting sales of 2.61 million units," Nintendo said in a statement.

"The April release of 'The Super Mario Bros. Movie' positively impacted sales of Mario-related titles," the Kyoto-based firm added. 

For the April-September period, net profit jumped 17.7 percent to 271.3 billion yen, with sales climbing 21.2 percent to 796.2 billion yen.

The Switch is in its seventh year -- quite old by console standards -- but "the Mario movie led to a significant turnaround", Hideki Yasuda, an analyst at Toyo Securities, told AFP ahead of the results.

A "Mario Red" edition of the Switch console and new Switch game "Super Mario Bros Wonder", both released in October, are selling well, he added.

"The Super Mario Bros. Movie" -- a joint project of Universal, Nintendo and Illumination studios -- is the second attempt to bring Mario to the big screen, after an ill-fated, live-action movie in 1993.

Nintendo said on Tuesday they will "release new offerings so more consumers keep playing Nintendo Switch even longer and we can maximize hardware sales" for the current fiscal year. 

President Shuntaro Furukawa said in an interview with the Nikkei business daily published last month that he "cannot give anything specific" about the successor to the Switch.

"We are still working on titles for the Switch for the year ending March 2025," he said.

Yasuda said hit content such as the Mario movie and new Zelda and Mario games are "continually being produced".

The Zelda game, featuring the exploits of Princess Zelda and the elf-like warrior Link, became a smash hit, selling more than 10 million copies in its first three days.

It had sold 125 million copies worldwide since its first edition in 1986, before the latest one came out.

But "Pikmin definitely contributed (to the results) in the first half", Yasuda added. 

Nintendo released "Pikmin 4", a popular game featuring plant-like creatures called Pikmin first published in 2001, on the Switch in July.

The company released "Detective Pikachu Returns" in October and "Super Mario RPG" will be out in November.