Nintendo profits tanked 43% in Q1 but hopes to bounce back with the Switch 2 release

Japanese video-game maker Nintendo on Thursday reported a 43% decline in profit for the fiscal year through March, but promised a turnaround as its Switch console upgrade goes on sale in June.

Nintendo Co.’s profit for the fiscal year through March totaled 278.8 billion yen ($1.9 billion), down from 490 billion yen the previous fiscal year.

Annual sales slipped 30% to 1.16 trillion yen ($8 billion) from 1.67 trillion yen, according to the Kyoto-based maker of the Super Mario and Donkey Kong games.

The fortunes of game companies tend to decline somewhat as time passes after a new game machine goes on sale since many people have already bought the machine, although new hit software helps boost the results.

Much anticipation has been building over the rollout of the so-called Switch 2, which goes on sale June 5.

Nintendo said it expects to sell 15 million Switch 2 consoles for the fiscal year through March 2026.

Demand has dwindled for the current Switch, now in its eighth year after its debut. The number of Switch players around the world remains above 128 million people, according to Nintendo.

Nintendo said attractive software was coming for the Switch 2 later this year, including “The Legend of Zelda” games, a Pokemon title and a Kirby game, as well as offerings from outside software companies.

Also adding to the momentum is the opening of a Nintendo store in San Francisco and the Super Nintendo World amusement facility opening in Orlando, both set for this month, according to Nintendo.

Nintendo is projecting a 300 billion yen ($2.1 billion) profit for the fiscal year ending in March next year, a nearly 8% improvement from the fiscal year just ended, on sales of 1.9 trillion yen ($13 billion), up 63% on-year.