Tag: Switch

Nintendo Financials & Hardware Sales Drop Double-Digits as Switch Ages in Fiscal 2025 Q1 Report

DomsPlaying

I’m here with a rare Friday recap, as everyone knows because they have studied my earnings calendar, of course.

Today in Japan, Nintendo reported results for its first fiscal quarter of 2025.

Here’s the headline numbers, during a tricky time where its storied Switch console is entering its final days and management makes moves towards the transition to its successor.

  • Revenue and operating profit declined well into double-digit territory.
  • The same goes for Switch console shipments, across all versions.
  • Switch unit sell-thru to consumers did reach a new lifetime milestone.
  • Mario Kart 8 Deluxe sold less than a million units for the first time since 2017.

It’s a tough one all around for the Mario makers, mainly due to a comparison to the company’s best Q1 ever last year due to contributions from a blockbuster film and mainline Zelda launch. Plus, the firm’s expenses are up due to investment in its next generation.

“During the first quarter of the previous fiscal year, unit sales of both hardware and software were extremely high for a first quarter,” management wrote in prepared remarks. “When The Super Mario Bros. Movie energized our dedicated video game platform business and The Legend of Zelda: Tears of the Kingdom was released, together with specially designed hardware based on that title.”

I’ll now look at the figures in more detail then provide a look ahead towards the future, a crucial time for one of gaming’s biggest and most beloved producers.

Taking a broad perspective, the main performance indicators from Nintendo’s most recent quarter ending June 2024 are below.

  • Revenue dropped 47% to $1.58B.
  • Operating income declined 71% to $350M.
  • Research & Development (R&D) expenses rose 18%.

As displayed in the quarterly charts later in this article, this was the lowest Q1 output since fiscal 2020 for both sales and profit. As Nintendo executives alluded in their notes, it’s mainly because there isn’t much driving growth right now, with the main release slate as two legacy titles with a fresh coat of paint while the firm navigates towards a transitory period.

Across product categories, here’s the breakout measured by revenue.

  • Software dollar sales made up 50.8%, up slightly from 50.1%.
  • Within that, 73% were first-party sales. Last year, it was 89%.
  • Digital represented 59% of the total, compared to 47% prior year.

Now, the regional sales ratios for its largest locales.

  • The Americas made up 45%, about the same year-on-year.
  • Japan saw a sizeable increase, from 20% to 26%.
  • Europe dropped to 21%, from 23%.

Due to the massive success of the Mario film starting April 2023, quarterly sales for Nintendo’s mobile and IP-related segment dropped 54% to $94M.

The below charts show sales and profit metrics for both this latest quarter and on a trailing 12-month basis for broader context.

  • Annual revenue is currently $9.34B, down from $11.86B.
  • Operating profit over that time is $2.55B, compared to $3.95B.
  • Both of these are the lowest since late in Fiscal 2020.

I’ll now shift focus over to the Hardware part of the first quarter report, where Nintendo shares how many units shipped and gives insight into sell-thru to consumers as well.

  • Switch saw 2.1M units shipped between April and June 2024.
  • That’s down 46%, and the lowest Q1 output since Fiscal 2019.
  • OLED experienced the largest drop of 56% to 1.24M.
  • Its older Lite version sold 330K, a decline of 23%.

“There were no such special factors in the first quarter of this fiscal year,” executives said. “And with Nintendo Switch now in its eighth year since launch, unit sales of both hardware and software decreased significantly year-on-year.”

This quarterly total brings lifetime Switch shipments to 143.42M, maintaining its spot as the third best-selling console ever, and bringing into question its ability to surpass Nintendo’s own DS (154.02M) and Sony’s PlayStation 2 (155M).

Beyond units shipped, management shared some insight into consumer sell-thru of the hybrid console. Over its life span starting in 2017, Switch has reached an impressive sell-thru milestone of 140M units.

It doesn’t take an enthusiast analyst to explain why a console in its eighth year, without a system seller, is on such a downward trajectory to start this financial year. Even if Nintendo achieves its shipment target, this will be the lightest full year of hardware sales during the Switch era.

Let’s look at the software categories, including new title performance for Nintendo during the last three months.

  • Switch game copies shipped in this period reached 30.64M, down 41% from 52.21M.
  • There are currently three million sellers, two of which are Nintendo’s.
  • This pushes lifetime Switch software units to nearly 1.27B.

The first million-seller to highlight was Paper Mario: The Thousand–Year Door debuting at 1.76M shipped during the quarter. As a remake, it’s tricky to make comparisons. The GameCube original sold 1.91M units in around three years. The other mainline series game on Switch, Paper Mario: The Origami King, started with 2.82M in 2020.

Luigi’s Mansion 2 HD was that second million-seller, moving 1.19M within just a few days in late June. The base game hit market in 2013 for Nintendo 3DS, selling 750K units in the United States alone within three months. The Switch title Luigi’s Mansion 3 released in October 2019 to 5.37M units its first quarter, albeit with a couple months on sale in that period.

Here’s an observation that shows how the Switch has saturated the market: Neither of those million sellers were called Mario Kart 8 Deluxe. This is the first quarter since back in July to September 2017 during which the console’s best-selling title didn’t hit a million copies sold. It did sell 930K all these years later, quite a strong Q1 compared to most games, and is now approaching 63M lifetime.

In terms of other lifetime milestones, The Legend of Zelda: Breath of the Wild trended above 32M, while Pokémon Scarlet & Violet became the third mainline franchise title to surpass 25M sold.

When it comes to units sold-thru to consumers (rather than shipments), Paper Mario: The Thousand-Year Door topped 1.3M units within six weeks of release, while Princess Peach: Showtime, which originally shipped 1.22M during the prior quarter, also moved past 1.3M by this metric.

Nintendo’s engagement statistics of Annual Playing Users hit a milestone at 128M, up from 121M a year back. The company didn’t share anything on Switch Online memberships, which were 38 million at last count in November 2023.

Nintendo suffered a double whammy as it entered fiscal 2025. This same quarter last year was massive on the strength of its biggest franchises and the Switch continues to show its age with a less compelling line-up than years past, featuring a portfolio titled towards refreshed older titles that aren’t as appealing as brand new entries. Combine that with a console that is present in many a household already, and there isn’t much upside on the financial side right now.

Speaking of that, management maintained its full-year outlook in these latest results. For now, at least.

  • Revenue expected down 19% to $8.7B.
  • Operating profit could decline 24% to $2.6B.
  • Annual Switch units off 14% to 13.5M.
  • Software units 17% lower to 165M.

These seem mostly reasonable to me, and I believe Nintendo can achieve all but one of them, even if barely.

It’s the hardware shipment figure where I remain skeptical. In order to hit a 13.5M annual target, Nintendo has to ship 11.4M more Switches over the next 9 months. Last year, when there was both a mainline Zelda and Mario among others to entice new buyers, it moved under 12M across the same nine month span! I’m maintaining a 12.5M to 13M forecast for the year, leaning towards the lower end.

Still, even assuming the lower end, that would put Switch around 154 million lifetime by March 2025. It’s going to be in contention at least for best-selling hardware of all time.

For a console in its home stretch, I’ll admit Nintendo is presenting an appealing line-up leading into the back half of its fiscal year. There’s The Legend of Zelda: Echoes of Wisdom in September, Super Mario Party Jamboree in October then Mario & Luigi: Brothership in November. Donkey Kong Country Returns HD is also slated for January 2025.

Plus, as we’ve entered the latter months of calendar 2024, might we hear about Super Switch? There’s a good chance, however I’m betting it happens right after the Switch’s final holiday season. Full reveal in January, launch April 2025 or later.

That ends the week, and another full recap on the earnings schedule. Hop over to social media for more coverage, and check back soon for more articles. Thanks for stopping by!

Note: Comparisons are year-over-year unless otherwise noted.

Exchange rate is based on reported average conversion: US $1 to ¥155.93.

Sources: Company Investor Relations Websites, Nikkei Asia (Photo Credit).

-Dom

Nintendo Posts Positive 2024 Annual Results & Sets Switch Successor Reveal for Current Fiscal Year

DomsPlaying

Keeping with my new tradition, I’m here with a quick-hitting recap of Nintendo’s latest annual results.

I’ll then look ahead to its current fiscal year, the 12 months ending March 2025, during which the company will officially reveal its next hardware.

Don’t worry. I’ll have my usual charts and reactions, just in an easier format!

Here’s the highlights for Nintendo’s 2024 financial report:

  • Both revenue and profit bounced back to growth in the single digits.
  • Annual Switch shipments were 15.7M, above its latest guidance.
  • During the latest quarter, Switch passed 140M sold lifetime.
  • Over half of software sales were digital for the first time ever.

While unit sales for consoles and software declined last year, Nintendo saw financial growth due to a depreciating yen, a shift to the premium Switch OLED model, shifting spending towards digital content and a sizeable impact from April’s The Super Mario Bros. Movie.

“For hardware, by continuing to convey the appeal of Nintendo Switch, we try to not only put one system in every home, but several in every home, or even one for every person,” management wrote. “Another objective is to continually release new offerings so more consumers keep playing Nintendo Switch even longer and we can maximize hardware sales.”

Scroll ahead for the full rundown and predictions for an exciting, and crucial, time in the company’s history.

Top level, these are the main stats for Nintendo’s annual results during the year ending March 2024.

Fair warning: Get ready for numbers!

  • Revenue up 4% to ¥1.67T ($11.57B).
  • Currency impact on revenue of ¥94.4B ($653M).
  • Operating profit rose 5% to ¥528B ($3.66B).
  • Currency impact on operating profit of ¥35B ($242M).

These were enough to log the third best year in the Switch era by both metrics. While impressive given its latest console’s age, having major releases in the Zelda and Mario franchises alongside a blockbuster animated flick were enough to make up for slowing unit sales.

As for product category breakouts:

  • Software represented 56% of total sales, up from 54%.
  • 81% of software sales were first party, up from 79%.
  • The proportion of digital software sales was 50%, up from 48%.

Regional splits were as follows:

  • The Americas at 44%, same as last year.
  • Europe was 24%, down slightly from 25%.
  • Japan reached 22%, compared to 23%.

Underlying a larger-than-usual portion of Nintendo’s growth was its mobile, IP and licensing segment. On the strength of the billion-earning The Super Mario Bros. Movie, sales here rose 82% to ¥11.2B ($77M), plus had the knock-on effect of boosting the popularity of Mario-themed titles in subsequent quarters.

I’ll now reflect on the Hardware portion of the report.

  • Switch shipments from January to March were 1.96M, down from 3.06M.
  • That brought the year to 15.7M, or 13% lower than fiscal 2023.
  • This figure was above management’s revised guidance of 15.5M.
  • OLED model was the only one showing growth, up 1% to 9.32M.

While hardware ended up meeting the latest target that executives set, it came in slightly below my personal forecast of 16M. Management called this “stable” for a console of its age.

Lifetime Switch shipments are now 141.32M, thus retaining its spot as the third best-selling gaming console ever.

Prior to this, figures were based on shipments to retail. Nintendo did provide a slide on sell-thru to consumers, charting it out over the Switch’s full life cycle.

Overall, it was the second lowest year for sell-thru other than 2017’s launch. The premium OLED model experienced its highest sell-thru to date, while the base model continued its steady decline, both as expected.

Moving on to Software results for the full year:

  • Game unit shipments declined 7% to 199.67M.
  • Even so, that was above the latest target of 190M.
  • There were 31 million-sellers. Nintendo produced 20 of them.
  • Lifetime Switch software unit sales approached 1.24 billion.

In terms of debuts, February’s Mario vs Donkey Kong remake collected 1.12M units. Additionally, Princess Peach: Showtime! moved over a million in a week, reaching 1.22M by the end of March.

Then there’s the ever-growing list of older and evergreen titles in the portfolio.

  • The Legend of Zelda: Tears of the Kingdom saw 20.61M in less than a year.
  • Super Mario Bros. Wonder jumped to 13.44M after two quarters.
  • July 2023’s Pikmin 4 finished the year at 3.48M.
  • Mario Kart 8 Deluxe raced towards 62M lifetime.

Shifting over to software sales as measured by sell-thru to consumers:

  • The Legend of Zelda: Tears of the Kingdom at 19.5M.
  • Super Mario Bros. Wonder was 12.4M.
  • Pikmin 4 eclipsed 3.3M, meaning most of its copies have been purchased.
  • November’s Super Mario RPG remake hit 2.6M (out of 3.31M shipped).

“The Legend of Zelda: Tears of the Kingdom, Super Mario Bros. Wonder, and Pikmin 4 all saw sell-through grow at a faster pace than any past titles released on Nintendo Switch in their respective series,” management wrote.

Executives also shared an update to Nintendo’s unique engagement statistic called Annual Playing Users. As of March, it reached an all-time record of 123M, up a million over the prior quarter and 7 million compared to the prior year.

The company might share an update for Switch Online memberships during a corporate briefing in the next few days. The service’s paid membership count was 38M as of September 2023.

It’s another mostly positive annual announcement for Nintendo, showcasing top-line momentum and profitability even as hardware and software units declined. It’s well-known that the market for Switch is saturated, which meant executives had to look for other avenues like film to keep growing, while also supporting the vast audience base with flagship franchises and external partnerships.

What’s to come for the company entering a pivotal time as it plans to bridge the gap between console generations?

Well, I’ll now run through the headlines for Nintendo’s fiscal 2025 targets:

  • Revenue could be down 19% to ¥1.35T ($9.34B).
  • Operating profit expected to decline 24% to ¥400B ($2.77B).
  • Switch anticipated to ship 13.5M units, down 14%.
  • Guidance of 17% lower Switch software units, or 165M.

“Switch has entered its eighth year since launch,” management mentioned. “While it will be challenging to sustain the same sales momentum as before, we will work to maintain high user engagement with the hardware and invigorate the platform so that more consumers continue to play Switch for longer.”

If that last bullet point is achieved:

  • Switch will compete for best-selling console ever at roughly 154.82M sold.
  • Nintendo DS is in second at 154.02M to date.
  • Sony’s PlayStation 2 is currently tops at 155M.

I see the financial forecasts as fine and achievable. On the other hand, Nintendo’s hardware plan is ambitious. Especially given the lighter release slate, chock full of remakes and reissues, and people waiting anxiously for that new announcement. I’m more around 12.5M to 13M, at most.

Speaking of Super Switch, the reveal is officially imminent!

Nintendo President Shuntaro Furukawa took to Twitter to announce that the announcement of Switch’s successor will happen this fiscal year. Though not at a June Direct, which will focus more on the slate of games for the back half of this calendar year.

Based on the guidance and an aggressive target for existing hardware, I expect a full-blown Super Switch reveal to happen around January 2025 with a subsequent launch sometime in or after April 2025.

That about does it for my latest reaction piece. What did you think? Predictions for Super Switch?

Hit me up here or on social media to chat and stay tuned for more coverage of earnings season soon. Thanks for reading!

Note: Comparisons are year-over-year unless otherwise noted.

Exchange rate is based on reported average conversion: US $1 to ¥144.52.

Sources: Company Investor Relations Websites, Nintendo Twitter.

-Dom

Nintendo Nears 140 Million Switch Units Sold & Raises Annual Outlook Again in Steady Fiscal 2024 Q3 Report

DomsPlaying

Next up for this quarters’ recap series, as you clearly know from bookmarking my earnings calendar, is Nintendo. The gaming company that continues to delight audiences and defy expectations.

The Japanese console manufacturer and mega publisher reported figures for the nine months ending December 2023, the third quarter of its fiscal year ending March 2024. Which means I have plenty to break down including quarterly, nine month and trailing annual numbers. A little bit of everything!

Nintendo’s quarterly financial results were down slightly in Q3, however its 9-month figure remains trending upwards during this likely final full year of the Switch’s life cycle.

Super Mario Bros. Wonder was the big winner of the quarter, moving nearly 12 million units as the fastest-selling Super Mario title in series history. Over the April to December span, The Super Mario Bros. Movie and The Legend of Zelda: Tears of the Kingdom were doing heavy lifting along with additional content for its suite of legacy titles like Mario Kart 8 Deluxe and Splatoon 3.

Nintendo shipped upwards of 6.9 million Switch units during the December quarter, and without official discounting at market. While down a bit since last year, that’s a healthy result for a console that saw its first holiday season back in 2017. This pushed lifetime shipments to nearly 140 million, steadily approaching the realm of all time behemoths like Nintendo DS and PlayStation 2.

“When we look at the sales situation so far this fiscal year against this backdrop, we believe that hardware sales have held stable since the first half and that the holiday season results were steady,” Nintendo President Shuntaro Furukawa said in a Q&A.

“We want to maintain momentum in the business through a good balance of both first-time buyers and demand for multiple units. During the holiday season, we noted a particular rise in first-time buyers of our hardware, and we see this as a positive sign for the Nintendo Switch business going forward.”

All of this led management to raise full year guidance yet again, similar to last quarter, for a number of things: sales, profit, hardware and software, in addition to a dividend hike that will return more profits to shareholders. I’ll cover these in more detail in a later section.

Now to the question on everyone’s mind: Where’s that Switch Pro? (Oh no, not again.)

Really, check below as I’ll fully cover the company’s report then drop a set of predictions, including my latest forecast on when the Switch’s successor will be out. Let’s jump into it!

I’ll now dig into the above slides and below charts, which cover all of the numbers Nintendo released during its third quarter 2024 announcement.

Overall, the firm generated $4.18 billion in profit during the three months ending December 2023. That equates to a 6% decline. Operating profit dipped 3% to $1.29 billion.

Across the latest three quarters, net sales grew 8% to $9.74 billion while operating profit rose an impressive 13% to $3.24 billion.

These can be attributed to the yen’s continued weakness overseas, a higher proportion of Switch OLED model shipments compared to the broader family of devices plus add-on content for its more evergreen titles. Not to mention having one of 2023’s biggest movies based on a world-renowned brand, I might add.

Expanding to latest annualized figure, which ends up being the 2023 calendar year number, revenue moved up 7% to $12.53 billion. That’s the best calendar year revenue number for Nintendo since 2008! Operating income bumped up even more, settling at $4.09 billion or an increase of 10%.

These growth numbers are all fantastic for a company that will likely move into its next generation of consoles within the next six to twelve months, and highlights the smart move by executives to diversify into different areas like digital support, intellectual property (IP) adaptation, online services and post-launch content drops.

Moving onto product categories, Nintendo’s hardware and software each contributed exactly 50% during the third quarter. This split last year was 51% and 49%, in favor of hardware. Across the 9-month period, the software slice was larger at 55% of the total. At the same time last year, it was 54%. Not too much movement in either direction over the last couple years.

With respect to regional splits, the latest nine months continued a slight shift away from Japan and towards The United States and its neighbors. The Americas made up 44% of sales, up from 43%. Europe remained flat around 25%, while Japan declined from 24% to 21%.

The digital portion of Nintendo’s sales during Q1 to Q3 moved up a couple percentage points to 48%, fitting the industry trend towards downloads as opposed to retail buying. Digital came in around a quarter of the company’s revenue stream, growing 12% in the last nine months to $2.42 billion.

Here’s where Nintendo stacks up against the industry’s biggest players. First, yen weakness does have a positive impact on revenue in local currency for companies that mainly operate globally, like a Nintendo or Sony. However when converting from yen to U.S. dollar, it doesn’t appear as attractive because of the low rate. Sony, which reports gain next week, had PlayStation at $28 billion annually while Tencent stacked up to $26 billion. Microsoft’s integration of Activision Blizzard brought it to $18.13 billion this quarter, while Nintendo comes in under $13 billion. However, Nintendo’s operating margins are best in industry, even while developing a new hardware.

Focusing strictly on Switch hardware shipments, these totaled 6.9 million during October to December. Compare that to 8.23 million the prior year.

Which is excellent for a console that’s saturated its market as much as Switch has. For context, I estimated that Microsoft shipped 4 million max Xbox Series X|S this holiday. Sony moved 7.1 million PlayStation 5’s in the quarter ending December 2023.

That brought hardware units to 13.74 million during the first nine months of this fiscal year, down 8% from 14.91 million. Management noted this was mostly in-line with expectations for the time frame.

As has been the case for a couple years, the predominant model during this period was the Switch OLED. That version shipped 8.17 million between April and December, up 6% from 7.69 million. Next up was the base model at 3.4 million, down 25% from the prior year’s 5.22 million. Rounding out the list was Lite, which grew 9% year-on-year from 2 million to 2.18 million.

So, this all brings Switch lifetime sales to 139.36 million. Is there a legit chance it clears the Nintendo DS at 154.02 million to become the company’s best-selling device ever? The answer is: absolutely.

Switch is under 15 million away from Nintendo DS. If the company’s target holds this fiscal year, it would need 13 million more during the financial period beginning in April. I am betting that, by the end of March 2025, not only will Switch be Nintendo’s best-selling ever, it will surpass PlayStation 2 at 155 million to secure the top spot on the all-time top seller list. Even if Super Switch exists!

Back to the latest announcement, Nintendo did share some insight into hardware sell-through to consumers. Namely that it’s been steady for the console’s age, and that the OLED version saw increased demand, echoing the growth seen in shipments. And it wasn’t just first timers, there were plenty of people who double dipped or grabbed replacements, according to prepared remarks.

Now swapping over to Nintendo’s other bread-and-butter which is software sales, this is where the team has shined the entire back half of this generation with both new games and existing support.

For the holiday quarter, software unit shipments for Switch totaled 66.87 million. That’s down only 14%. Expanding to the April to December period, unit sales for software dipped 5% to 163.95 million. Considering the saturation and how many titles it’s already moved, that year-to-date figure showed great resilience.

The proportion of first party titles, those published by Nintendo, rose from 79% to 83% in the nine months ending December. That’s more than four out of every five games purchased in this period, namely due to flagship Zelda and Mario launches plus a mainline Pikmin.

How’s about yet another lifetime milestone for the Switch’s historic run? Just this quarter, lifetime unit sales on the platform surpassed 1.2 billion. The strength of its portfolio is unrivaled even compared to prior Nintendo generations, plus there’s the legacy library via Switch Online, broad attraction of franchises like Animal Crossing and third party offerings like Fortnite.

Speaking of big sellers, Switch now has 24 “million-seller” titles which shipped a million units or more in the latest nine months alone. Within that, 17 were first party and 7 were external publishers. Compare this to last year’s 27 overall, and it’s another example of the platform’s appeal.

The elephant in the room was Super Mario Bros. Wonder, not just shipping 11.96 million but also selling-through 10.7 million of those to consumers. For comparison to recent franchise titles in their respective first quarters: Super Mario Odyssey had 9.07 million in 2017, New Super Mario Bros. U Deluxe reached 2.5 million in 2019 and 2021’s Super Mario 3D World + Bower’s Fury saw 5.59 million. Keep in mind the lower install bases at this times, of course.

Elsewhere, new launch in Super Mario RPG Remake shipped 3.14 million since hitting market in November, another benefactor of the Switch effect. July’s Pikmin 4 also hit the 3 million milestone, moving up 720K units to 3.33 million.

After an incredible run since May, The Legend of Zelda: Tears of the Kingdom reached the 20 million milestone this quarter, settling at 20.28 million. While it’s slowed in recent months, it’s still a ridiculous feat to hit this sort of threshold in less than a year.

One one that seems to never slow down is Mario Kart 8 Deluxe, which zoomed past the frankly absurd 60 million milestone this quarter. After somehow shipping 3.57 million in the holiday quarter, it’s held pace at 60.58 million. That’s well above the second place on the platform in Animal Crossing: New Horizons at 44.79 million. I don’t know how Nintendo can top this latest Mario Kart entry, and I don’t envy the designers that have to make its follow-up.

The last statistic revolved around engagement, as Nintendo announced a record 122 million Annual Playing Users as of December, up from 114 million last year. While this isn’t as indicative of active players as something like monthly or daily active users, it does show that buyers at least login to their devices over the years. Separately, Nintendo didn’t share any updates on Switch Online subscribers, last reported at 38 million in September 2023.

Between a nice holiday quarter, the financial growth in the first nine months of fiscal 2024, the fastest-selling Super Mario ever, major milestones for its biggest franchises, diversifying into film and other media plus revitalizing classics to close the cycle, Nintendo’s latest run continued in this earnings report as Switch approaches its seventh birthday next month.

To say it’s exceeded all expectations, and continues to prove analysts wrong, is an understatement.

Before closing out, let’s look at that updated guidance and make a few predictions. Management revised a number of forecasts upward, including financial targets and unit sales expectations.

The firm now expects 3% more net sales and 2% better operating profit during the fiscal year ending March 2024. That translates to roughly $11.4 billion and $3.56 billion, respectively. This indicates Nintendo expects both of these to grow in the single digits, and I expect them to be achieved. If not exceeded by a decent margin.

On hardware, according to Furukawa commenting after the company’s announcement, the Switch will remain its “main business” through the end of March and into the new fiscal year. In fact, he called out internet rumors and asked people to “exercise good judgment” when hearing them.

Fitting with this sentiment, the company raised Switch unit guidance by 500K to 15.5 million. That implies the January to March quarter to have only 1.76 million shipped in order to reach this goal. Personally, I’ve been predicting the 16 million to 16.5 million range for this year. I see no reason to change that now, and I’m even leaning towards the upper end of this range.

The real question on everyone’s mind is the Super Switch! Mainly when, and how much. Executives are playing coy for now, as expected.

“We are unable to make any comments beyond saying that our company is constantly conducting research and development on new hardware and software,” Furukawa said.

There were some small hints in his latest Q&A series posted today. Furukawa pointed out the hybrid model is the “optimal way” to deliver Nintendo’s unique experiences. That all but confirms the successor will have both handheld and console functionality, consistent with recent speculation that’s pointed to a larger screen in portable mode.

I’ve written before that my forecast puts Super Switch in the fourth quarter this calendar year. I’ll also stick to this, expecting an initial announcement after Nintendo’s current financial year ends, so as to not jeopardize hitting that hardware target. This puts a reveal in April or May, then more details and presentations leading into launch around October.

Management also bumped up its software expectations by 3% for the full year, now guiding that Switch will have 190 million units shipped in that period alone. This feels on the money, with slight upside to beat it.

The current slate features one brand new title Prince Peach: Showtime!, a more niche title launching in March that I think will do alright yet not gangbusters. There’s also the remake of Mario vs Donkey Kong out next week. Between these and continued interest in Super Mario Bros. Wonder among others, I’m not worried about Nintendo reaching its more optimistic guidance.

Beyond that, it’s anyone’s guess because Nintendo hasn’t shared much for its offerings beyond a pair of revitalized old games in Luigi’s Mansion 2 HD, on the calendar for Summer 2024, and the pending Paper Mario: The Thousand-Year Door remake sometime this year. Metroid Prime 4 remains a mystery, the only title in its financial report listed as to be announced.

One title that probably won’t hit Switch anytime soon is Palworld, what with The Pokémon Company’s investigation into 2024’s biggest sales surprise so far for potential IP breach and asset usage. While I’m not sure that a legal battle will ensue, I’m sure it will remain on other platforms for the foreseeable future.

That does it for my latest earnings recap. I’ll be back soon with more coverage of the season and other topics as 2024 keeps it moving. Be well, all!

Note: Comparisons are year-over-year unless otherwise noted. Exchange rate is based on reported average conversion: US $1 to ¥143.22.

Sources: Company Investor Relations Websites, Video Games Chronicle.

-Dom

Switch & Software Sales Milestones Produce Nintendo’s Most Profitable Year Ever

DomsPlaying1 Comment

It’s no secret that Nintendo’s Switch hybrid platform was a game-changer for the company after its difficult Wii U era. The hybrid console’s success and its corresponding software sales, especially for those that the Japanese gaming giant has published, have lifted it to the best revenue in over a decade plus record profits during its fiscal year ending March 2021.

These are staggering results. Fitting for Nintendo, I’m jumping right into it.

Previously I covered Sony and Microsoft’s gaming business results this quarter, with annual sales for those two competitors at $24 billion and $15 billion respectively. Nintendo’s latest fiscal result falls between them, generating approximately $16 billion overall. That’s an increase of 34% since last year and, most importantly, the highest yearly sales since the roughly $16.7 billion over a decade ago in 2010.

When it comes to profitability, the report is even more impressive. Operating profit boosted a staggering 82%, reaching just above $5.8 billion for the last 12 months. This is the best ever result for a company that’s been around longer than any of us. It’s also the second best growth rate since 2010, behind only 2018 at the start of the Switch generational cycle.

These figures blew past the company’s targets by a substantial margin, even if those estimates were conservative. During its presentation, Nintendo executives attributed it to a strong hardware presence especially in Australia and Asia, a shift in the ratio of digital sales plus three dozen million-sellers on Switch this past year. It’s attracting new customers and encouraging owners to snag an additional console. 20% of Switch purchases are second devices. And that’s only going to grow.

When I break it down more closely myself, the near or at record figures come from a combination of various underlying factors. Main one being a Switch hardware push, since the console represents more than half of the company’s business. Also, the launch of third party exclusive Monster Hunter Rise, continued momentum of nearly all first party software especially Mario Kart 8 Deluxe and Animal Crossing: New Horizons plus impact from the end of the company’s 35th anniversary celebration of the Mario franchise. Particularly on Super Mario 3D All-Stars as it went off market simultaneously (and conspicuously) at the same time the fiscal year ended.

Now, the best part. To dig into the nitty gritty!

Profit is off the charts, top-line revenue is the best in years, Switch hardware is selling at a rate that not even the most optimistic predicted and Nintendo’s software figures are keeping pace in the current unpredictable environment.

After shipping 4.72 million Switch consoles in the January to March window, sales to date reached a major milestone in terms of broader industry comparisons. With a lifetime hardware figure of 84.59 million shipped, it’s now passed both Sony’s PlayStation Portable, upwards of 82 million, in addition to the 81.51 million of Nintendo’s own Game Boy Advance family of devices. And depending on which source, it’s close to if not above the beloved Xbox 360 from Microsoft.

(I say that because there are slightly different reports of Xbox 360 sales since launch in 2005. It’s anywhere between 84 million and 85.5 million since Microsoft stopped reporting exact hardware statistics. Suffice to say, Switch may have passed it by now when taking into consideration the month since March end.)

Based on the latest quarterly numbers, Switch units reached 28.83 million for this past fiscal year. Its best to date. This is a increase of 37% year-on-year, plus more than 2 million units above guidance. Which Nintendo had even raised. Twice.

Within the console segment, 20.32 million of those shipments were the standard Switch model. Switch Lite contributed 8.51 million. Both of these are up the same 37%, consistent with the platform’s aggregate growth.

Now at the start of this past fiscal year, Nintendo’s target for Switch hardware was unbelievably low. Even more so that it was issued right during the early part of the global pandemic and Animal Crossing: New Horizon’s meteoric early prosperity. Which is somewhat understandable. Companies tend to be conservative, that way it’s easier to beat guidance. It’s still no less impressive, proving there’s considerable demand still at this middle portion of its cycle. Nintendo doesn’t seem as affected by the global chip shortage that’s plaguing other manufacturers.

This sort of momentum is consistent with domestic results, and The Americas make up nearly 42% of Nintendo’s overall sales so it’s notable to compare. As I wrote in April, Switch has been the leading console by unit sales in the United States for 28 straight months. Over 2 years. Sure, most of this was during the last legs of PlayStation 4 and Xbox One. Which is why 2017 was the absolute perfect time for Nintendo to launch, supported over the past few years by the quality of its exclusives plus ongoing third party support, notably within the independent development space.

Expanding to a historical context, Switch is on a faster pace than the Nintendo Wii, launched way back in 2006, and 2013’s PlayStation 4 when measured by unit shipments. Both of which are ubiquitous within gaming, the former being Nintendo’s top-selling home console and latter as the second best-selling home platform ever. Switch strength has especially accelerated since this time in 2020, a period of notable growth for obvious seasons. I included a thorough chart from friend of the site Daniel Ahmad, Analyst at Niko Partners, which illustrates launch-aligned growth for many of the major console releases in history.

Lastly on the hardware side, out of its updated 84.59 million lifetime shipment figure reported today, 81 million have been sold through to consumers. Console sell-through during the quarter ending March alone surpassed the record high of the same period last year. When Animal Crossing: New Horizons launched!

Moving over to game performance, Nintendo Switch software unit sales topped off at 230.88 million for the fiscal year alone. This includes first and third party, retail and digital, remakes and ports, any and all individual games sold that works on the platform. That’s a jump of just under 37%, nearly perfectly in tune with hardware growth. This shows folks aren’t only buying up Switches with increased demand, it reveals that they are buying multiple copies of its most popular games. A trend we’ve seen for this platform since it started.

For the fourth quarter alone, Switch recorded 54.78 million software units shipped which is up from 45.59 million. All of this contributed to lifetime Switch software rising a whopping 65% year-on-year, to 587.12 million. It’s hard to even consider that type of figure in context.

Individual title growth stemmed a lot from newer games in the Mario franchise in addition to the most green of evergreen from Nintendo, then a particularly monstrous seller from Capcom.

Compilation Super Mario 3D All-Stars crossed the 9 million unit sold-in threshold since launch last September, no doubt boosted by Nintendo pulling it from stores in what I still consider a questionable decision for the sake of preservation. Subsequently, Super Mario 3D World + Bowser’s Fury launched this past February during Nintendo’s final fiscal quarter. Since then, it’s shipped 5.59 million and sold 4 million of that thru to buyers. For perspective, the original game on Wii U has only moved 5.87 million copies across its entire time on market.

In one of the more ridiculous numbers when stepping back, Mario Kart 8 Deluxe sold 10.62 million units last year alone. We’re talking an increase of 43%! This is for a game whose first version started on Wii U back in 2014. It’s the highest-selling Switch title to date and probably will always be, currently standing at 35.39 million copies worldwide. That’s over 5 million more than The Witcher 3: Wild Hunt or The Elder Scrolls V: Skyrim, the latter of which is frequently parodied for being available on nearly every platform in existence.

Just behind Mario Kart 8 Deluxe on the Switch top seller list, Animal Crossing: New Horizons shipped a cold 20.85 million in the fiscal year despite a dearth of seasonal updates lately. Even when some people are unhappy with it, plenty of others are still purchasing it. This brings its lifetime total to 32.63 million.

Rounding out the Top 3 Switch platform sellers from Nintendo is fighting game (yes, it’s true) Super Smash Bros. Ultimate, moving exactly 5 million units across the last 12 months. A bit more pedestrian in its growth at 27% for the title that hit market in late 2018. 23.84 million is its count to date.

In other updates, New Super Mario Bros. U Deluxe and Ring Fit Adventure both crossed the 10 million copies milestone in March. That second one is really incredible, considering it’s a dedicated fitness game at a higher price tag because of its included accessory. Even a title like Clubhouse Games: 51 Worldwide Classics is selling, hitting 3.14 million this past quarter.

Honestly, I could list even more and they would mostly show the same trend. Sometimes even I have to stop and take stock of these figures. Rattling them off is like binge-watching classic shows like Breaking Bad or The Sopranos or trying to speed-run an Assassin’s Creed or Grand Theft Auto in a single sitting. It’s impossible to appreciate the bigger picture without taking a breather and really thinking about how many copies these games are selling right now on the platform, not to mention the impact it has on the popularity of those published by third parties.

Out of the 36 million-sellers this year alone, 22 were published by Nintendo. The remaining 14 were third parties and “grew steadily.” This includes Monster Hunter Rise, a major growth driver towards Nintendo’s record results. Capcom’s brand new Switch exclusive in the long-standing franchise reached 4 million copies shipped within *three days* of its March 26 release. It moved a million more by early April, making it already the 3rd best-selling Monster Hunter title of all time. Notable here is the companies collaborated on a special edition Switch model, no doubt a factor during this time right before the fiscal year finished up.

While it’s not as prominent a segment as other companies in the industry, Nintendo experienced a marked rise in digital sales recently. In terms of revenue, digital generated $3.1 billion or around 20% of the overall business. That’s up from under $1.9 billion. Note this measure is a combination of full game downloads, online services and add-on content. Within dedicated video game platform sales by dollar amount, 43% is digital which is up from 34% previously. When talking unit sales, digital is now 47% compared to 41% and 42% for the two years prior, respectively. When charting quarterly trends, it’s clearly pushed up by ample demand last summer during the height of quarantine times.

Whew! Got all that?

The hybrid console’s success and its corresponding software sales, especially for those that the Japanese gaming giant has published, have lifted it to the best revenue in over a decade plus record profits during its fiscal year ending March 2021.

Certain smaller items that didn’t take up much in the fiscal report were its online service, mobile, IP licensing and playing cards businesses.

The company didn’t share an updated figure on Nintendo Switch Online paid subscribers. The last we heard was 26 million during its Corporate Management Briefing over six months ago in September 2020. All executives said this time was that “in addition to the growth in sales of indie titles and other download-only software without corresponding physical versions, Nintendo Switch Online sales were also steady” and that the team was investing in this part of the business, though didn’t specify exactly how much or to what extent.

Mobile and IP related sales grew 11% year-on-year, though still represent a small portion of the total business. $519 million to be clear. Within this, sales from smart devices were constant so it was actually bolstered by royalty income gains. This is not an encouraging sign when it comes to mobile expansion. Still, Nintendo said the Pikmin mobile collaboration with Niantic, the same team behind Pokémon Go, is scheduled for a global launch in back half of 2021. So I expect smart phone contribution will raise at least slightly in the near future.

On its conference call in Japan, executives expanded on various areas within the financial report. Based on notes from those listening, the most curious comment to me is how the company saw record research and development spending recently. For the year, this reached roughly $850 million and it will increase a bit into next year. The reason is partly because of investment in the successor to Switch. To my knowledge, this is the first mention of such a follow-up platform.

Intriguing..

Anyways, looking ahead, Nintendo also provided initial estimates for various parts for fiscal year ending March 2022.

In terms of overall revenue, it expects a decline of 9% to around $14.6 billion. Operating profit target is 22% lower, starting at $4.55 billion. When it comes to Switch, Nintendo estimates shipping 25.5 million consoles and 190 million software units in the upcoming 12 month span. Both of these would be declines as well.

So, why the pessimism?

“The consolidated earnings forecast is based on the premise that we will be able to secure the parts needed for the manufacture of products in line with our sales plans,” executives said. “But this could be impacted by obstacles to the procurement of parts, including the increase in global demand for semiconductor components. There also remains the risk associated with COVID-19, which is difficult to predict.”

To me, this is prudent given the circumstances. Uncertainty around component availability and the dubious nature of selling products in a pandemic once they are manufactured. However, I think it’s too conservative and will be raised at least once. Probably during the mid-way point of the year. Especially given the rumor as recently as last week from Nikkei that annual Switch production could be upwards of 30 million based on sources from part suppliers.

My estimate for Switch hardware is much closer to that figure than Nintendo’s. I’m assuming right now 28 to 29 million plus well over 210 million software copies. I think there’s a good chance it could be the best year to date for the hybrid console, even five years later.

I was way upbeat at the start of the generation. Though not as much to predict this sort of trajectory. And we still don’t know if the rumors around a New Nintendo Super Switch Pro XL model in the near future are true! Either way, Switch will certainly pass Wii lifetime sales sometime in the next 12 months in what will be a momentous occasion.

Nintendo’s software pipeline definitely looks lighter right now. But isn’t that always the case? It’s probably because the biggest releases either aren’t dated yet or haven’t even been revealed. New Pokémon Snap came out in late April. Miitopia, Game Builder Garage and Mario Golf Super Rush are slated for the early summer months. The Legend of Zelda: Skyward Sword HD is July, then there’s the trifecta of Pokémon games between “late 2021” and “early 2022” listed in its report.

There’s also Splatoon 3 and Square Enix’s Project Triangle Strategy (Temporary Title) currently slated for a broad date of 2022. The heavier hitters that could push sales above that guidance are Bayonetta 3, Metroid Prime 4 and of course the sequel to The Legend of Zelda: Breath of the Wild. Even if the last one is the only one of the three out this fiscal year, which I believe it will be, it’s going to be a special one for the company, its shareholders and audience alike.

Indie support will naturally continue, with Switch being a most appealing platform due to its flexibility and on-the-go use case. Nintendo has shown more of a willingness for partnerships as well even with its most coveted brands, so could this be the year where we hear another collaboration with say Ubisoft? The most significant partnership would be anything with Microsoft when it comes to Xbox Game Pass or a Cloud offering. Talk about an industry-shaking event.

Overall, I can’t say much more about its financial year than I already have. It was record-breaking and wholly impressive 12 months, especially how hardware is penetrating to the point where 1 in 5 households currently buying a Switch already have one. Profit is off the charts, top-line revenue is the best in years, Switch hardware is selling at a rate that not even the most optimistic predicted and Nintendo’s software figures are keeping pace in the current unpredictable environment. Nintendo remains a company true to itself in quality, output and setting trends rather than chasing them. It’s the type of strategy that continues to, quite literally, pay off.

Thanks for reading!

Note: Exchange rate used for Japanese Yen to U.S. Dollar is as of today. 0.0091 JPY to 1 USD.

Sources: Capcom, Cláudio Luiz Castro (Photo Credit), Daniel Ahmad (Niko Partners), Guinness World Records, Manny Moreno (Photo Credit), Nikkei, Nintendo Investor Relations, NPD Group.

-Dom

Animal Crossing: New Horizons Rings in a Rallying of March U.S. Sales Results

DomsPlaying1 Comment

In the pantheon of Nintendo’s most popular games, people normally think of franchises like Mario, The Legend of Zelda and Smash Bros.

In 2020, it’s time to officially add Animal Crossing to the list.

The latest entry in the long-running, family-friendly simulation series entitled Animal Crossing: New Horizons is a massive commercial seller since its release last month. It’s the main driver behind a stellar March sales result domestically, undoubtedly boosting both software and hardware gains.

Attribute performance to pent up demand resulting from the last mainline entry being way back in 2012, the transition from its handheld hardware to the big screen on Nintendo Switch plus the tragically convenient timing of launching alongside enormous appetite for design, creation and social collaboration during a global lock down.

These myriad of factors caused New Horizons to achieve the top spot on the March 2020 software rankings in the United States, according to a new report from NPD Group. Easily the best launch ever for the series. It’s immediately the second best-selling game of 2020, leap-frogging everything except Call of Duty: Modern Warfare as Activision’s premier military shooter moves up to number one.

In what’s a staggering statistic, New Horizons generated the 3rd highest launch month sales of any game ever published by Nintendo in the history of domestic tracking behind only Super Smash Bros. Ultimate in late 2018 and 2008’s Super Smash Bros. Brawl. That means it’s above any Mario or Zelda, as storied as they might be.

Keeping with the theme of ridiculous numbers, launch month unit and dollar sales have already exceeded the individual *lifetime* sales of every other entry in the internally-developed Nintendo Animal Crossing franchise. Yes. It took less than a month on market to beat the overall results of those games.

What’s most impressive is NPD Group tracking doesn’t even include digital downloads for Nintendo games. This is strictly based on physical, boxed sales. Considering the stay at home orders across the world, I wouldn’t be surprised if digital contributed upwards of 40% or more overall. (Purely speculation. No quotes.)

A rising tide does lift all boats in this case. And that boat is more than likely used to get to one’s island in Animal Crossing, if sales are any indication.

Changing it up (heh) to another major software release of March, PlayStation 4 exclusive baseball series MLB The Show continues its quiet consistency on the charts. This year’s entry MLB The Show 20 hit third on the March software rankings, sliding in just below Call of Duty: Modern Warfare (which keeps on with its momentum, achieving an all-time high for a March month, might I add).

The Sony Interactive Entertainment San Diego studio creation is the top seller on the PlayStation 4 individual platform chart for March, plus already a Top 5 performer for the year to date overall software list. This year’s game yet again set another launch month franchise record, same as last year’s MLB The Show 19. It’s the definition of consistency, hitting the charts strong every single time.

(Who caught all the puns?)

Plenty of other new games dotted the March overall software chart. Capcom’s zombie remake Resident Evil 3 achieved the fourth spot and reached #7 on the list of 2020 best-sellers to date. DOOM Eternal from Bethesda Softworks went on a tear to #6. Worth noting that Bethesda is another publisher that doesn’t include digital sales, thus performance for DOOM Eternal accounting for downloads could be even better.

Two recent Japanese games charted in the States during March: Persona 5: Royal from Atlus/Sega lands an impressive start at #7 while Koei Tecmo’s Nioh 2 barely misses the top 10, debuting at the 11th spot.

Finally, Nintendo’s Pokémon Mystery Dungeon: Rescue Team DX achieved a Top 15 start while Activision Blizzard’s Call of Duty: Modern Warfare 2 Remastered rounds out the Top 20 even with a surprise, timed limited release solely on PlayStation 4.

Following the above highlights, here are the full overall software rankings for March 2020 then the year to date.

Top-Selling Games of March 2020 (Physical & Digital Dollar Sales):

  1. Animal Crossing: New Horizons*
  2. Call of Duty: Modern Warfare
  3. MLB: The Show 2020
  4. Resident Evil 3 Remake
  5. NBA 2K20
  6. DOOM Eternal*
  7. Persona 5: Royal
  8. Grand Theft Auto V
  9. Borderlands 3
  10. Mario Kart 8: Deluxe*
  11. Nioh 2
  12. Red Dead Redemption 2
  13. FIFA 20
  14. Super Smash Bros. Ultimate*
  15. Pokémon Mystery Dungeon: Rescue Team DX*
  16. Madden NFL 20
  17. Just Dance 2020
  18. Star Wars Jedi: Fallen Order
  19. Mortal Kombat 11
  20. Call of Duty: Modern Warfare 2 Remastered

Top-Selling Games of 2020 So Far (Physical & Digital Dollar Sales):

  1. Call of Duty: Modern Warfare
  2. Animal Crossing: New Horizons*
  3. Dragon Ball Z: Kakarot
  4. NBA 2K20
  5. MLB: The Show 20
  6. Grand Theft Auto V
  7. Resident Evil 3 Remake
  8. Madden NFL 20
  9. Mario Kart 8: Deluxe*
  10. Star Wars Jedi: Fallen Order

Last month’s whopping result for Switch came in above this figure, likely upwards of a million or even more units. For a single month in one territory, this is incredible. It reveals how important quality software is to drive hardware sales years after initial launch, something Nintendo has perfected by now.

Let’s put these software starts in context and take a broader look at industry spending in March.

In a busy month, overall domestic consumer spending reached $1.6 billion which is an increase of 35% since this time last year. In fact, it’s the highest result in more than a decade for this particular time frame. The last time a March month generated higher sales was way back in 2008, at $1.8 billion.

Last month, dollar spending on software alone jumped 34% to $739 million in what was the best March month since 2011’s $787 million. Out of the top ten overall titles listed above, all but one of them generated higher sales than those at the same ranks last year.

Hardware spending increased a massive 63% since March 2019. Nintendo Switch was the best performer of course, more than doubling its sales year-over-year. Still, even its major competitors in PlayStation 4 and Xbox One both saw monthly increases above 25% using the same time frame comparison. This shows that it wasn’t just Nintendo’s release slate that provided a bump.

Expanding on Switch console sales, it was the single best month in the history of Nintendo’s hybrid console on the strength of the aforementioned Animal Crossing: New Horizons. That’s right. Last month was better than even its launch three years ago, the prior record holder. And that’s with supply constraints this year!

Let’s quickly review for context. Unit sales for Switch back during its launch month in March 2017 reached approximately 906K. Which means last month’s whopping result for Switch came in above this figure, likely upwards of a million or even more units. For a single month in one territory, this is incredible. It reveals how important quality software is to drive hardware sales years after initial launch, something Nintendo has perfected by now. Just when you think it can’t top itself, it does.

The final category measuring spending is accessories and game pads, up 12% since last year to $397 in March. This is a record high for a March month for both accessories, previously achieved back in 2008, and game pads as well. The top-selling game pad was the Nintendo Switch Pro Controller last month, while PlayStation 4 hit its best ever combined game pad spending during a March month.

A rising tide does lift all boats in this case. And that boat is more than likely used to get to one’s island in Animal Crossing, if sales are any indication.

Before we wrap, it’s not all great news unfortunately.

Broadening the scope tells somewhat of a different story for the first quarter overall. Year-to-date spending as a whole is down 4% since this same time last year, hitting around $3 billion. This covers the same categories of hardware, software and accessories and game pads.

Two of these categories are lower compared to 2019: software and accessories and game pads. Consumer spend on software titles during 2020 so far dipped 8% to $1.4 billion, while accessories and game pads weakened to $905 million, 3% off year-on-year. Which means that even with the new release boost last month, the earlier months in 2020 are dragging.

Even so, Switch and hardware buck the trend for the quarter. Hardware sales rose nearly 10% to $773 million during 2020 so far. Here’s the main factor: When talking unit sales, Nintendo Switch saw the best quarter for *any* platform, regardless of manufacturer, since a decade ago in 2010 when it was achieved by the Nintendo DS. A major Q1 hit will certainly do that.

To summarize, March ends up being an exciting month for video game sales and the industry for those teams releasing new games especially. Partially a byproduct of those major software launches, somewhat due to the coronavirus impacting buying and playing habits. It’s a sad, tragic situation for the world right now. One of the few bright spots is being able to enjoy video games, which means some staggering statistics for a March month here in the States.

I highly recommend sifting through NPD Analyst Mat Piscatella’s thread on Twitter where he provides even more detail, notably on individual platforms. He also posted a follow-up piece at the NPD Blog to give more insight into Animal Crossing in particular.

Another month and quarter in the books. And it was a wild one. How did your predictions go? What’s the biggest surprise? Are you somehow one of the few people like me that isn’t playing New Horizons? Swing by in the comments or Twitter to chat.

Lastly, I hope you and your families, friends and loved ones are safe during this difficult time. Shout out to everyone working at essential jobs and healthcare. You are heroes. Thanks for reading!

^Digital PC Sales Not Included, *Digital Sales Not Included, #Digital Sales on Consoles Included

Sources: Activision Blizzard, Go Nintendo, Nintendo of America, NPD Group, Sony Corp.

-Dom

New U.S. Video Game Sales Last Month Were Slowest May in Over Two Decades

DomsPlaying

Back again with the sales talk! I’ll do my best to make this piece as riveting as possible, though as expected May was a bit of a snoozer when it comes to the market here in the States. It’s a mid-year month in the year before a new console generation. So it’s more like game stales, amirite.

Okay. Moving on.

The NPD Group produced its latest monthly report this past Tuesday, with the standout statistic being that sales of new video game releases were at their lowest level for a May month since 1998. Mainly because there just weren’t a lot of notable major software releases. Which checks out, because it’s probably the quietest month we’ll see all year. What I’m really saying is, not a lot of publishers abide by the “It’s gonna be May” mantra.

In terms of the overall industry, total consumer spending declined 11% to $641 million as sales across all three of its tracked meta segments either declined or remained flat.

Beginning with hardware, the category saw a dip of 20% to $149 million. Nintendo Switch was the main bright spot, as the only console to show year-over-year growth when compared to May 2018. For this year to date, total hardware sales eclipsed $1.1 billion which is 17% lower than this same period last year.

As alluded to above, Nintendo continues its streak of wins. May was the 6th consecutive month in which the Switch hybrid led hardware sales. As measured by both units sold and dollar sales. Switch also remained the highest selling console of the year to date. Reminder that Nintendo announced during its last earnings report that Switch lifetime sales hit 34.74 million globally. Essentially, the company that people counted out during its flubbed Wii U era is now propping up the industry while competitors Microsoft and Sony see their hardware grow long-in-the-tooth.

Talk about the perfect segue.. Switching briefly to peripherals, at least multiplayer games like Fortnite and now Dauntless entice people to keep buying those headsets and controllers. Accessory sales stayed consistent around $230 million, with Sony’s black DualShock 4 controller as the top-selling within this category for May and 2019 so far. Consumer spend on accessories for year to date is now at $1.4 billion, up approximately 3%.

In terms of games, software sales across console, portable and PC platforms dropped 13% in May to $262 million. When talking overall software sales, it’s the lowest May monthly result since 2013. I mentioned the dearth of new game sales already. This is sluggish for even the usual summer drought.

While total software purchasing was soft, I believe there are individual games worth noting before we get to the full charts.

Mortal Kombat 11 is having a.. killer launch season. NetherRealm Studio’s latest fighting game achieved the number one spot on the overall software chart for a second straight month since its launch in late April. It led the monthly Xbox One and PlayStation 4 individual rankings, too.

Not only that, and most importantly, it moved past Kingdom Hearts 3 to become the best-selling game of the year so far. To put MK11’s fantastic momentum in perspective, its 2nd month sales result is almost twice the amount of any other installment in the classic franchise. Part of the reason is how NetherRealm is adapting the series for modern tastes, offering unlockables in the base game then pushing post-launch content. The game’s latest character addition Shang Tsung released mere days ago. I’m anticipating good momentum even as other big releases hit, due to the appeal of new content over time plus establishing itself as a leading platform in the genre.

I’d also like to highlight results for three other titles: Total War: Three Kingdoms, Rage 2 and.. Minecraft. Yup. Mojang’s creation game that released a decade ago, having since attained cultural phenomenon status and sold more units than anything except Tetris, is back in the monthly top ten list. The 9th best-selling overall, to be exact, plus the 7th best-selling game on Xbox One. Honestly, how are there so many people that don’t already own Minecraft?

Sega’s Total War: Three Kingdoms and Bethesda’s Rage 2 were the only new releases achieving top ten status last month, slotting at #3 and #4 respectively. Both of these are impressive accomplishments, considering the past few Total War games didn’t even chart and Rage 2 sales don’t include digital. (Bethesda doesn’t share that portion for its games). In an interesting but ultimately useless tidbit, the original Rage was also the 4th best-selling title in its release month of October 2011. The more you know, ya know.

(Shameless plug: I reviewed Rage 2 here and had a good time with it.)

Finally, PlayStation 4 exclusives like Days Gone and MLB The Show 19 are showing solid legs considering availability on solely one platform. Both games maintain spots in the top ten, plus move up in the year-to-date chart. And the beleaguered multi-platform title Anthem from BioWare is still hanging onto the fourth spot in the 2019 rankings. Both of these are happening in the doldrums of late Spring of course, so keeping an eye over time will tell the full story.

It’s now time to check out the main software rankings for May, which focus on strictly the U.S. market. For individual platform charts and way more information, read this extensive thread from NPD Analyst and, more importantly of course, my buddy Mat Piscatella.

Top-Selling Games of May 2019 (Physical & Digital Sales):

  1. Mortal Kombat 11
  2. Days Gone
  3. Total War: Three Kingdoms
  4. Rage 2*
  5. Grand Theft Auto V
  6. Super Smash Bros. Ultimate*
  7. Red Dead Redemption 2
  8. MLB The Show 19
  9. Minecraft#
  10. NBA 2K19
  11. Mario Kart 8*
  12. Tom Clancy’s The Division 2^
  13. Call of Duty: Black Ops 4^
  14. New Super Mario Bros. U Deluxe*
  15. Marvel’s Spider-Man
  16. The Legend of Zelda: Breath of the Wild*
  17. Tom Clancy’s Rainbow 6: Siege
  18. Assassin’s Creed: Odyssey
  19. Team Sonic Racing
  20. Yoshi’s Crafted World*

Top-Selling Games of 2019 (Year to Date):

  1. Mortal Kombat 11
  2. Kingdom Hearts 3
  3. Tom Clancy’s The Division 2^
  4. Anthem^
  5. Resident Evil 2 Remake
  6. Super Smash Bros. Ultimate*
  7. Red Dead Redemption 2
  8. Days Gone
  9. MLB The Show 19
  10. Sekiro: Shadows Die Twice

^Digital PC Sales Not Included, *Digital Sales Not Included, #Digital Sales on Consoles Included

I think I did pretty well squeezing as much as I could out of a mostly uneventful time frame. How did your predictions hold up? Surprises? Leave a note here or shoot me a message on Twitter. Hope to see you again next month!

Sources: The NPD Group, Bethesda Softworks, Microsoft, Sega, GamesPress.

-Dom

Mortal Kombat 11 & Nintendo Switch Kombine to Top April’s U.S. Video Game Sales Report

DomsPlaying

Lots of fighting game fans exclaimed “Get Over Here!” to NetherRealm Studio’s latest installment in the storied franchise, Mortal Kombat 11. The brutal beat-em-down title, published by Warner Bros Interactive and released on April 23rd, was the best-selling game of last month in the States according to The NPD Group’s latest report.

Mortal Kombat is one of the most well-known gaming series ever, partly due to its controversial graphic violence and propensity to upset pearl-clutching government officials. This most recent game’s predecessor Mortal Kombat X (2015) went on to be the biggest commercial success in franchise history, eclipsing more than 11 million units sold per famed co-creator Ed Boon.

While we don’t know global unit sales for Mortal Kombat 11 just yet, we now know that this latest entry is selling well domestically. It not only topped the April monthly chart, it also instantly entered the year-to-date list as the 2nd best-selling of 2019, second to only Square Enix’s Disney mash-up Kingdom Hearts 3.

Interestingly, it was tops on all four of its platforms: Xbox One, PlayStation 4, PC and even the Nintendo Switch. An impressive result all around, and I expect it will continue to chart at least during a slower summer release calendar.

Second place for April went to open world zombie game Days Gone from Sony Bend Studio, a PlayStation 4 exclusive title. I wrote recently that, despite thinking the title itself was mostly mediocre, I prognosticated that it would have broad market appeal and sell quite well. I even thought it might top the list of best-sellers last month.

While I was too bold in my prediction, arriving at #2 is a very good result. Namely since it’s limited to just the one platform. Days Gone also had the 7th best launch month for a Sony-published game in NPD’s tracking history, plus became Bend’s top-selling game ever after being on sale less than a full month.

A quiet success story unfolding as we approach mid-year is the solid momentum of another title only available on PlayStation 4, that being MLB The Show 19 from Sony San Diego. The baseball sim has achieved the #3 spot during the past two months of charts since its release on March 26th. It’s also moved up into the Top 10 of the year so far, hitting exactly #10.

MLB The Show 19 is currently the best-selling sports title of the year to date, and it’s still the fastest launch for a game in the franchise when lining up all the relevant launches. I bet the development team is.. having a ball!

Rounding out the Top 5 respectively are Ubisoft’s Tom Clancy’s The Division 2, the shared world military RPG that was last month’s best-seller, then Nintendo’s ever-present party fighter Super Smash Bros. Ultimate. The latter of which recently eclipsed a crazy 13.81 million units sold globally.

And of course, Rockstar Games continues to live up to its moniker by having not one but two of its works present on April’s list. Grand Theft Auto V being the leading one, coming in at #6 despite releasing all the way back in 2013. It’s a theme we’ve seen in most monthly charts, and I’ve continually stated it will be this way until its successor is out.

Below are April’s main software charts, which focus on strictly the U.S. market:

Top-Selling Games of April 2019 (Includes Physical & Digital Sales):

  1. Mortal Kombat 11
  2. Days Gone
  3. MLB The Show 19
  4. Tom Clancy’s The Division 2^
  5. Super Smash Bros. Ultimate*
  6. Grand Theft Auto V
  7. Sekiro: Shadows Die Twice^
  8. Call of Duty: Black Ops 4^
  9. NBA 2K19
  10. Yoshi’s Crafted World*
  11. Red Dead Redemption 2
  12. Mario Kart 8*
  13. Assassin’s Creed: Odyssey
  14. Minecraft#
  15. New Super Mario Bros. U Deluxe*
  16. Final Fantasy X/X-2 HD
  17. The Legend of Zelda: Breath of the Wild*
  18. Jump Force
  19. Battlefield V*
  20. Borderlands

Top-Selling Games of 2019 (Year to Date):

  1. Kingdom Hearts 3
  2. Mortal Kombat 11
  3. Tom Clancy’s The Division 2^
  4. Anthem^
  5. Resident Evil 2 Remake 2019
  6. Super Smash Bros. Ultimate*
  7. Red Dead Redemption 2
  8. Sekiro: Shadows Die Twice^
  9. Jump Force
  10. MLB The Show 19

^PC Sales Not Included, *Digital Sales Not Included, #Digital Sales on XB1 & PS4 Included

Flipping over to consoles, Nintendo Switch saw its 5th consecutive month atop the hardware chart as measured by both dollar sales and units. It’s still the best-selling console of the year, as well. The last time it was outpaced by Sony’s PlayStation 4 was during the pre-holiday rush of November. Even then, Switch generated more revenue. PS4 just happened to see higher unit sales because of heavy discounting.

Consumer spending on games in the States crept up 1% in April, to $842 million overall. This was driven by PC and console software, up 15% to $427 million, and the Accessories segment as it bumped 5% to $256 million on the strength of Amiibo and DualShock 4 sales. These two segments offset a 29% decline in hardware, which fell to $160 million.

For 2019 so far, consumer spending in the games market totals $4 billion. A figure that’s down 2% when compared to the same time period last year. Out of that, software has contributed almost half with roughly $1.9 billion in dollar sales.

My read overall on April is that the top three sellers in particular are impressive, even though I was wrong about which would be first. Especially Mortal Kombat 11.. fighting its way to the second spot on the year-to-date list. That indicates to me that early demand is strong. I’m not sure it can reach the lofty heights of its predecessor, though I’m confident it will carve up a good chunk of commercial success before we see what NetherRealm does next.

Another story that I think warrants more attention is BioWare’s Anthem, published by Electronic Arts, maintaining the 4th spot of 2019 so far. Granted, it’s way early. Then EA said during its Q4 earnings call recently that the game’s early sales came in below the company’s targets. It’s worth seeing if it maintains this position as the year progresses, with more major releases scheduled for the late part of the summer into the autumn rush.

Hardware sales are going to be uneventful until, honestly, holiday season at the earliest. If not next year, when I’ve been saying that the next generation of consoles will start during the second half.

Additional details on individual platform results can be found at the linked video above, from NPD Analyst and friend of the site, Mat Piscatella.

So. How did your predictions go? Any big surprises? Please share in the comments or let’s catch up on Twitter! Thanks for stopping by, as always.

Sources: The NPD Group, NetherRealm Studios, Sony Bend Studio, Sony San Diego, Nintendo, Electronic Arts, Wikipedia.

-Dom

Nintendo Reports Best Results in Nearly a Decade Despite Missing Switch Target

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Shuntaro Furukawa, Nintendo’s President.

Japanese gaming giant Nintendo shared its latest annual results today. I didn’t want to jump (like Mario, get it?) to conclusions, so I’ve read through carefully. The outcome? I’m equal parts impressed and cautious, the former due to the results themselves and the latter due to where executives see the company next year.

The good news is that the games manufacturer hasn’t experienced this sort of financial bump in years. In particular, software is performing incredibly well even compared to its estimates. It broke through the forecast of 110 million to an impressive 118.55 million copies sold during this latest year, on the strength of titles like Mario Kart 8 Deluxe and Super Smash Bros. Ultimate.

If the teams working at or with Nintendo are experts at one thing, it’s making compelling games specifically for its platforms. While Switch hardware numbers often grab headlines, it’s the quality of games that support its business. A console can’t succeed without the support of a software lineup.

Diving into some numbers for a moment, I’ve built the above chart to illustrate results over time and expand on my headline. This is net revenue, which is overall sales achieved by Nintendo. Current revenue figure is around $10.8 billion when converted to dollars, though the chart is in local currency.

Similarly the above shows operating profit, which takes into account certain expenses. Another quality result, driven by the higher revenue offsetting slightly increased sales including those from selling and marketing its products.

Downside though is that its current generation Switch console saw sales of 16.95 million units, which means it fell short of the 17 million Nintendo expected to sell during this time frame. In fact, this target was initially upwards of 20 million around this time last year. Turns out that both of these figures were optimistic.

Which leads me back to my point on software sales, and why they are so key to Nintendo’s success. Many individual offerings are maintaining impressive momentum, especially those we’d call “evergreen” which means they are more timeless than others. Mario Kart 8 Deluxe remains the best-selling title on Switch, hitting 16.69 million units compared to just above 15 million last quarter. For a game that technically had its start on Nintendo’s prior generation Wii U device, this is excellent and conveys the power of a fine family-friendly multiplayer game.

Super Mario Odyssey and Super Smash Bros. Ultimate round out the Top 3, with 14.44 million and 13.81 million copies to date respectively. While I expected stellar results from Odyssey, it’s Smash that is the real winner here, fighting its way towards the top of the list.

So. If it’s doing so well financially, and selling software, why might I be cautious?

Well, because of where Nintendo itself expects to go. It’s just as much about guidance as it is results. Guidance which I consider to be conservative, and even timid considering its upcoming prospects.


First, the firm anticipates 18 million Switch units and 125 million software units in the year ending March 2020, which would be up a modest 6% and 5% respectively. On the financial side, execs think both sales and profit will increase 4%. These are.. lackluster, though not entirely unexpected given this past year’s result and considering the new leadership of President Shuntaro Furukawa.

Given the rumors of new Switch models as early as this year, plus key software titles in Super Mario Maker 2 (announced for a late June release), Pokemon Sword & Shield and a new Animal Crossing, I was hoping for more ambitious targets from Nintendo. This is also supported by recent reports of expansion into the world’s largest gaming market of China, which to call a massive opportunity is an understatement.

Still. Maybe some of these drivers are further out that I thought. During the call associated with this earnings release, President Furukawa revealed they won’t be talking new hardware or revisions during June’s major Electronic Entertainment Expo (E3) event. We’ll have to wait further to see if the manufacturer will try to bolster sales using either a “mini” iteration or a more powerful version of the Switch. There’s also no timeline for the China expansion, so that could push further into future fiscal periods.

One additional point before we wrap up:

Nintendo’s foray into mobile continues, with the beta for the previously-announced Mario Kart Tour beginning this summer. This past year, mobile titles like Dragalia Lost drove growth of 17% within its mobile segment to just over $400 million in sales. It’s certainly a small portion of the overall business, however it’s the one segment that many cite, including myself, as having the best upside.

All told, Nintendo’s solid financial performance is undeniable. However, I see a disconnect between what I expect for its future prospects and what the company itself thinks. Similar to fans of upcoming games like Bayonetta 3 and Metroid Prime 4, which are currently listed as “To Be Announced” in Nintendo’s pipeline, I’m left both wanting and quite curious about what the future holds.

Sources: Nintendo Investor Relations. Bloomberg. Wall Street Journal. Fortune.

-Dom

Companies of E3: Nintendo Spotlight & Treehouse Live

DomsPlaying

https://www.youtube.com/watch?v=M2mZS_p4A7Y

 

 

Nintendo $NTDOY is the last company to have an official press event, albeit in digital form rather than a live show. First it shared a 25 minute-long Spotlight with fans, which you can see in its entirety above, and now it’s moved right into a long session of Treehouse Live. It will be streaming its Treehouse Live segment from E3 both today and tomorrow.

 

Don’t let the length of its showcase fool you; Nintendo packed in a ton of games and reveals into this time, which you’ll see broken out one-by-one below, and it’s still revealing new stuff on its ongoing streams. Not to mention, we now know a lot more about Super Mario Odyssey!

 

What It Showed:

 

 

Super Mario Odyssey: It was shown at the end of the digital show, but I have to write about it first here. I’m not often rendered speechless. But Nintendo’s trailer and subsequent gameplay that it’s streaming as I write this for its upcoming 3D Mario game is breathtaking. And we now know its release date: October 27th!

 

https://www.youtube.com/watch?v=hUObvU9A_Cg

 

Here’s the gameplay segment from Nintendo’s Treehouse Live. Almost a half hour long. Lots of mechanics and areas shown, including a really cool section when it transitions from 3D to 2D gameplay. The game continues to surprise and charm!

 

https://www.youtube.com/watch?v=Xa4VmZBhdUM

 

Montage: Briefly showed a trailer featuring a number of games: ARMS, Pokken Tournament, Rocket League (a new announcement for the platform), Splatoon 2. Basically, a number of multiplayer games that can be played on Switch.

 

 

Rocket League: As mentioned above, the 2015 competitive online game that blends cars and soccer will be out on Switch in Holiday 2017.

 

 

Xenoblade Chronicles 2: Japanese RPG from Monolith Soft will be releasing Holiday 2017.

 

https://www.youtube.com/watch?v=DPafFVi6BaE

 

Kirby: New Kirby game, with a working title, releasing next year.

 

 

Metroid Prime 4: There is actually a mainline Metroid game being developed for Switch. But all we get today is a logo, hah!

 

https://www.youtube.com/watch?v=gc9FeeAEMWk

 

Metroid Samus Returns: Nintendo has announced two Metroid games in the same day, which is crazy. This is a 3DS game that Nintendo just unveiled on its Treehouse Live stream.

 

 

Yoshi: Nintendo is really bringing its A-game when it comes to its established, most popular franchises. This time it announced a new Yoshi game, no title, releasing next year.

 

https://www.youtube.com/watch?v=_T3Bx1fTtvI

 

Fire Emblem Warriors. Upcoming hack-and-slash game for both Switch and New 3DS, this is a collaboration between Intelligent Systems and Koei Tecmo.

 

https://www.youtube.com/watch?v=GGFe9zGPBeQ

 

The Legend of Zelda Breath of the Wild, New DLC: As Nintendo announced back when the game was announced, Breath of the Wild is the first game in the franchose to have post-launch additional content. Which is awesome, because it means we get more of one of the best games this year. First pack is June 30th, at which time there will also be four new amiibo figures available for characters in the game.

 

 

 

Mario + Rabbids Kingdom Battle: Same game we saw at Ubisoft’s show yesterday. Releasing August 29th.

 

https://www.youtube.com/watch?v=p2pOtuan4js

 

Elder Scrolls V: Skyrim for Switch: Similarly, we saw this game at Bethesda’s show on Sunday night.

 

What It Didn’t Show (Yet): Super Smash Bros, Capcom’s Monster Hunter XX, Online Service, Virtual Console or Mini SNES.

 

Now that Nintendo’s Spotlight has finished up, it marks the end of the major conferences for this year’s E3. But the festivities are just kicking off, with the show floor opening today and running through Thursday. I’ll probably have another write-up or two before the week is up, but follow me on Twitter for updates in the interim. Thanks again and enjoy the show if you are there or following from home!

 

-Dom

Casual Friday: February 24th, 2017

DomsPlaying

 

Hi! Yup, it’s me again. Dom. I know it seems like it’s been a while.

 

I’m back with a new edition of Casual Friday for February 24th, where I round up the week’s most recent and relevant news to give a quick commentary. This week the companies featured are Nintendo, Koei Tecmo, Sony and Microsoft. Take a load off, keep it casual!

 

 

It’s hard to believe that the newest console from Nintendo ($NTDOY), the Switch, is out just a week from now next Friday, March 3rd. But it’s true, it’s around the corner and that means previews of the console-handheld hybrid itself plus its launch games such as Zelda: Breath of the Wild and 1-2 Switch are starting to pop up. While we won’t get full reviews on the Switch until next Wednesday, March 1st or Zelda until next Thursday, March 2nd, we do know the early impressions are somewhat mixed on the hardware.

 

The concept of the Switch is awesome: a device that you can dock at home to play games on your TV, then bring on the go as a handheld gaming device. But according to previews and hands-on impressions, the execution is where it’s lacking so far leading me to believe the launch of the system is a bit premature. The reason? I think it’s that Nintendo wants to release it before fiscal year-end in March, before which the company has stated it will ship 2 million units. All hardware launches are messy, granted, but the Switch is being bogged down by a number of concerns: lackluster launch line-up apart from Zelda, technical issues with its “Joy-Con” controllers, no Virtual Console at launch (a service where gamers can download and play classic Nintendo games) and lastly, certain aspects of its online services will not be available right away.

 

Don’t get me wrong, I’m excited for the console and will personally be a day-one buyer. I just feel that Nintendo is soft-launching the Switch hardware around its financial calendar, which is causing some features to be non-existent and lots of games are still in development. Good news is that I fully expect the console to look a whole lot better come holiday season later this year.

 

 

In very upbeat news, Japanese publisher Koei Tecmo ($3635) shared that its latest samurai action game Nioh has sold more than 1 million copies worldwide in just its first two weeks on sale. This is great news for the publisher of games like Dynasty Warriors and Ninja Gaiden, the latter of which being made by Team Ninja, the same team responsible for Nioh. You’ll also recognize the Tecmo name from classic sports titles like Tecmo Bowl during the late 80’s. Nioh features action and role-playing elements and is lauded (or cursed, by some) for its very challenging difficulty, pitting the main character William against tough human enemies and supernatural bosses during a trek across 1600s war-torn, Sengoku-era Japan.

 

There are a number of reasons I find this number quite impressive. First, the game is a PlayStation 4 exclusive title and a brand new IP for Koei Tecmo in somewhat of a niche genre. Also, the game is almost entirely in Japanese and its story is communicated via subtitles. Lastly and arguably most notably, Koei Tecmo totally underestimated how much demand there would actually be for this game as it based physical shipments on pre-order figures. This is proven by the firm openly acknowledging that retailers do not have stock. Even the game’s Amazon listing has shown a one to two-month shipping target for the past week or so. I can’t recall the last time that’s happened for any game!

 

What that means is this sales figure could have been even higher if more physical copies were available. Especially in Japan, where in a show of goodwill, the company offered a discount on the digital version if you were to purchase it in lieu of a physical disc.

 

 

 

As you can see, it’s quite a busy time for tech and gaming in particular. In other big gaming news, Sony ($SNE) and its internal studio Guerilla Games is releasing sprawling open-world action title Horizon: Zero Dawn next week and it’s been getting rave reviews. Horizon is another PlayStation 4 exclusive title, set in a world where humans have reverted back to tribal ways and now coexist with technologically-advanced animals of all kinds. It features a strong female protagonist named Aloy (not the most “traditional” name, I know) that is trying to find the origins of both her people and the mysterious, mechanical creatures.

 

Reviewers have compared Horizon to games like Tomb Raider, as both star leading ladies with bad-ass bow-and-arrows, or even RPGs like Witcher 3 in that they are set in beautiful, lush open worlds. Friends at Super Data predict that the title could sell around 8 million copies over its life span, but I actually think it could reach almost that amount just this year IF Sony bundles Horizon with a version of its newest console version the PlayStation 4 Pro. Which it would be silly not to, honestly.

 

Think about a triple-A console exclusive such as Uncharted 4: A Thief’s End, which has sold roughly 8.7 million copies since its release mid-last year. Granted that’s an entry in a well-established series, while Horizon is a new brand, but I still think it proves there is huge upside for a great exclusive within Sony’s ecosystem. Especially since I predict there will be at least 60 million PlayStation 4’s sold by this year’s end, if not more, I believe Horizon can eclipse 7 million in a year’s time implying roughly 11% of PS4 owners have bought the game. Not an unrealistic amount.

 

 

And now to wrap things up, let’s briefly chat on Sony’s main competitor this generation, Microsoft $MSFT. The firm’s Xbox brand has announced its Electronic Entertainment Expo (E3) briefing will take place on Sunday, June 11th at 2 pm Pacific/5 pm Eastern. Now, I tend to place less stock in the importance of public press conferences than other gamers, but even I admit it’s a big opportunity for Microsoft to tell us a lot about the future of its Xbox hardware family, Project Scorpio.

 

It’s no secret Xbox One is not selling as well as the PlayStation 4 this generation. Or that gaming revenues have declined recently for the firm overall. But I still think there is a lot of brand recognition and confidence behind Xbox, and it’s crucial to maintain healthy competition in the console gaming market. Microsoft’s online gaming service Xbox Live user base is up 15% since mid-2015 to 55 million active players despite being the lagging console in terms of hardware sales. Plus, sales are gaining within gaming software and services businesses, with digital game transactions hitting $1 billion for the first time in its history during 2016’s second financial quarter.

 

Additionally, the Xbox division under Phil Spencer’s leadership has placed user-friendly efforts of backwards compatibility (where you can play older games on the Xbox One) and cross-play across console and PC in the forefront. Sure, these types of features don’t necessarily sell consoles, but it’s crucial for Xbox to continue providing fan service in the interim before its (expected) big reveal of Scorpio in June at this E3 presentation. And I think it will be just that: a big reveal that will reinforce my confidence that Xbox can remain a viable competitor in the console space.

 

What are your thoughts on upcoming gaming hardware in Nintendo Switch or Project Scorpio? Have you played Nioh? Do you plan on trying out Horizon: Zero Dawn? Feel free to comment or chat on Twitter, and enjoy your weekend!

 

-Dom

 

Sources: Nintendo, Koei Tecmo Twitter, Sony, Open Critic, Super Data, Microsoft, Xbox Twitter