Nintendo has released its financial reports that detail the company’s performance in the first quarter of its current FY23 fiscal year. The report shows an operating profit loss and a drop in hardware and software sales.
In net sales, Nintendo reported an overall 307.4 billion yen, which is down by 4.7% YoY (Year-over-year). Hardware sales totalled 3.43 million units, with a 22.9% drop in YoY. Software sales, on the other hand, totalled 41.41 million units with an 8.6% YoY drop.
The company’s mobile sector also took a hit as incoming smart-device content declined YoY, which resulted in a decrease of 16.8% for a total of 10.9 billion yen.
Nintendo’s operating profit also saw a decline of 15.1% to 101.6 billion yen, but net profits were up by 28.3%, totalling 118.9 billion yen. The company stated that this is in part due to foreign exchange gains of 51.7 billion yen on the currency’s depreciation at the conclusion of the first quarter.
When the chips are down…
Considering the reason behind the total decline in sales, Nintendo highlights that the ongoing semiconductor shortage has significantly affected its production line, making the company unable to conduct production as planned. This led to fewer units being shipped out during the period which led to a decline in sales.
The company has also recently announced that it has no plans of raising the price of the Nintendo Switch in native Japan because of the yen’s weakness to many electronic companies like Apple.
Nintendo has placed much of the blame for its sales drop on semiconductor component shortages and claims that it expects availability and procurement to gradually increase over the course of summer all the way into autumn/fall.
As we prepare for the Holiday season, Nintendo says it will leverage appropriate means of shipment to ensure as many Switch consoles are delivered to various regions.
It’s a story that’s sounding familiar all across gaming right now.
Isa Muhammad is a writer and video game journalist covering many aspects of entertainment media including the film industry. He's steadily writing his way to the sharp end of journalism and enjoys staying informed. If he's not reading, playing video games or catching up on his favourite TV series, then he's probably writing about them.
