Nintendo quarterly profits jump less than expected

Nintendo grew operating profits 30% in the second quarter but this was much less than analysts had estimated due to a stumble in software sales for its Switch console.

The Japanese giant reported JPY30.9bn ($275m) of operating profit in the July-September quarter, up from JPY23.8bn a year ago and an eight year high but still well below the JPY41.9bn average estimate from analysts.

Revenue was JPY220.7bn, the lowest quarter since the launch of its Switch console in March 2017, due to a lack of hit games. Revenue grew 193% compared to the same period last year where it reported JPY75bn. This year it was also below market projections which expected JPY232bn.

During the quarter, Nintendo sold 3.19m units of the Switch console, up from 2.92m units it sold in the year ago period. It is now at 5.07m units for the financial year so far and 22.86m since its launch in March 2017.

Nintendo sold 42m Switch games sold in in the first half of its trading year, almost double the 22m in the same period a year earlier. September also saw the release of mobile game, Dragalia Lost, which has been hailed as a hit by co-developer CyberAgent Inc.

“From the beginning we decided on a target that would be challenging to reach, not easy. The holiday season battle begins now,” said president Shuntaro Furukawa, who assumed the role in June.

He has high hopes for next month’s release of Pokemon: Let’s Go and December’s Super Smash Bros Ultimate.