Nintendo has made a bold forecast, predicting Switch 2 sales will reach an impressive 15 million units by the end of the 2025/26 financial year. This optimistic outlook is paired with expectations for software sales to triple, totaling 45 million units sold, not including bundled software like the highly anticipated Mario Kart World bundle, set to launch alongside the base model on June 5th.
This forecast was unveiled in the company's end-of-year results for the fiscal year spanning April 1, 2024, to March 31, 2025, which were published this morning. In the last financial year, Nintendo successfully sold 10.8 million original Switch consoles, marking a significant 31.2% decrease year-on-year. Additionally, software sales for the first generation of Switch dropped by 22.2%, totaling 155.41 million units, which included 2.97 million units attributed to bundled software.
Nintendo's report indicates a concerning trend, with net sales recorded at 1.164.9 billion yen, a 30.3% decline compared to the previous year. Furthermore, net profits fell sharply by 43.2%, landing at 278.8 billion yen. Despite these challenges, Nintendo remains focused on the forthcoming hardware, aiming to ramp up both hardware and software sales by emphasizing the unique appeal of the new Switch 2 and consistently releasing new titles.
Interestingly, the company's forecasts are based on U.S. tariff rates effective as of April 10, 2025. Nintendo has stated, "For the purposes of our financial forecast for the next fiscal year, U.S. tariff rates effective on April 10, 2025, U.S. Eastern Time, are maintained throughout the fiscal year." Any changes to these tariff rates could potentially influence their financial outlook, and the company will continue to monitor the situation closely to adapt to market conditions.
Nintendo's strategy is understandably centered around the new hardware due to the retail impact of the Switch 2 announcement on the current model. Following the January reveal of the successor, Q4 sales plummeted to just 1.26 million Switch units. Despite this, Nintendo is holding out hope to sell 4.5 million original Switch consoles in the upcoming financial year—a commendable target for a console that is now in its ninth year of life, especially considering its successor can play nearly all existing games.
On another note, annual active users have seen a decline, dropping by approximately 1 million to 128 million. The global sell-through of original Switch units (hardware sold directly to customers, rather than units in retail) is now approaching a remarkable 150 million units. However, digital sales have also faced a downturn, decreasing by 26.5% year-on-year. Despite this drop, the proportion of digital sales compared to physical sales increased by 3.3%, with digital now accounting for 62.9% of all software sales.
Nintendo has highlighted several key successes for fiscal year 2025, including Super Mario Party Jamboree (7.48 million units), The Legend of Zelda: Echoes of Wisdom (4.09 million), and the remake of Paper Mario: The Thousand-Year Door (2.10 million). Additionally, Mario Kart 8 Deluxe has added another 6.23 million sales to its lifetime total, now reaching 68.2 million units sold.
With such ambitious projections, the question arises: Will Nintendo face challenges in selling 15 million Switch 2 consoles by April 2026? Given the current demand and excitement surrounding the new console, this goal appears to be quite conservative. What are your thoughts? Share your opinions below!
