Nintendo Co. (7974) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 FY25 declined 46.5% year-over-year to ¥246.6 billion, with operating profit down 70.6% to ¥54.5 billion and net profit down 55.3% to ¥80.9 billion, reflecting a high comparison base from last year and the Nintendo Switch's eighth year in market.

• Hardware sales fell 46.3% and software sales dropped 41.3% year-over-year, with no major new releases or external drivers like last year's Super Mario Bros. Movie.

• Digital sales fell 32.6% year-over-year but accounted for a higher 58.9% of total software sales, driven by a shift toward digital and stable Nintendo Switch Online revenue.

• Mobile/IP-related sales dropped 53.8% due to lower movie-related revenue.

• Profit attributable to owners of parent was ¥80.95 billion, down 55.3% year-over-year.

Financial highlights

• Net sales: ¥246.6 billion (down 46.5% year-over-year).

• Operating profit: ¥54.5 billion (down 70.6% year-over-year); ordinary profit: ¥113.5 billion (down 55.3%).

• Net profit: ¥80.9 billion (down 55.3% year-over-year).

• Gross profit: ¥152.4 billion (down 45.8% year-over-year); gross margin rose 0.9 pts to 61.8%.

• EPS for Q1 FY2025: ¥69.53, compared to ¥155.48 in Q1 FY2024.

Outlook and guidance

• FY25 full-year guidance unchanged: net sales ¥1,350 billion, operating profit ¥400 billion, net profit ¥300 billion.

• Dividend forecast for FY25 is ¥129 per share, down from ¥211 in FY24.

• Nintendo Switch hardware sales forecast at 13.5 million units and software at 165 million units for FY25.

• Focus remains on maximizing Switch hardware and software sales with new releases and platform engagement.