As COVID-19 Pandemic-Boosted Video Game Boom Wanes, Nintendo’s Profits Fall
Japanese video game maker Nintendo’s profit dropped 19% in the first half of its fiscal year compared to the previous year when it experienced a boom due to people being isolated at home by the coronavirus pandemic. In isolation, people wanting new ways to occupy their free time turned to Nintendo products.
Nintendo Co, based in Kyoto, reported a 171.8 billion yen (US $1.5 billion) profit for the April-September period on Thursday, November 4th, 2021. This is down from the 213 billion yen in the same period in the previous year. Fiscal half sales slipped 19% to 624 billion yen (US$5.5 billion). This was not broken down into quarterly numbers.
Nintendo, the company behind the Super Mario and Pokémon games, was one of the various global companies that received a boost in sales from the pandemic by providing at-home entertainment. Animal Crossing: New Horizons by Nintendo enjoyed strong sales in the April-September period of the previous year. Although the game was incredibly popular to the point of boosting sales of the Nintendo Switch machines, the momentum was hard to maintain through this year.
Furthermore, the shortage of computer chips caused by the pandemic is hurting production of Switch machines. Nintendo lowered its forecast of Switch sales for the second fiscal half from 25.5 million units to 24 million.
The end-of-year holidays are critical for Nintendo’s profits. So far, Nintendo has sold almost 93 million Switch machines worldwide, including the Switch Lite version.
The company expects a profit of 350 billion yen (US$3 billion) for the full fiscal year through March 2022, which is down 27% from the previous fiscal year.