Nintendo : Financial Results Explanatory Material (with Notes)

Financial Results Explanatory Material

1st Quarter of Fiscal Year Ending March 2024

Nintendo Co., Ltd.

August 3, 2023

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Nintendo Co., Ltd.

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1. Consolidated Financial Results and Outlook

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Nintendo Co., Ltd.

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Consolidated Financial Highlights

FY23/Q1FY24/Q1 Comparison

Net sales	307.4	bn yen	461.3	bn yen	+50.0	%
Operating profit	101.6	bn yen	185.4	bn yen	+82.4	%
Operating profit ratio	33.1	%	40.2 %	+7.1 pt.
Ordinary profit	166.7	bn yen	253.7	bn yen	+52.2	%
Net profit	118.9	bn yen	181.0	bn yen	+52.1	%
Net profit ratio	38.7	%	39.2 %	+0.5 pt.

• Net profit: Profit attributable to owners of parent
• FY = Fiscal Year
  FY24/Q1 indicates the period between April 1, 2023 and June 30, 2023.

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• Year-on-year,net sales for the first quarter of the fiscal year increased by 50.0% to 461.3 billion yen, operating profit rose by 82.4% to 185.4 billion yen, ordinary profit rose by 52.2% to 253.7 billion yen, and profit attributable to owners of parent rose by 52.1% to 181.0 billion yen.

Nintendo Co., Ltd.

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Consolidated Sales

	FY23/Q1	FY24/Q1	Comparison
Net sales	307.4 bn yen	461.3	bn yen	+50.0 %
Dedicated video game platform*1	295.6 bn yen	427.4	bn yen	+44.6 %
Mobile, IP related income, etc.*2	10.9	bn yen	31.8	bn yen	+190.1 %
Playing cards, etc.	0.8	bn yen	1.9	bn yen	+147.3 %

*1	Includes hardware, software (including downloadable versions of	FY24/Q1 Regional Sales Ratio
	packaged software, download-only software, add-on content,
	and Nintendo Switch Online) and accessories.
*2	Includes income from visual content, smart-device content and royalties.	12.5% 20.0%	Japan

Effect of changes in foreign exchange rates		The Americas
on net sales: +20.5 billion yen	22.9%	Europe
	44.6%	Other

Proportion of sales outside of Japan: 80.0%

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• Sales from our dedicated video game platform business increased by 44.6% year- on-year to 427.4 billion yen. In addition to the increase year-on-year in unit sales of both Nintendo Switch hardware and software, another main factor in this growth in net sales was the larger percentage of hardware sales accounted for by Nintendo Switch ‒ OLED Model, which has a higher unit price. The depreciation of the yen also had an effect.
• In the mobile and IP related business, overall sales rose by 190.1% year-on-year to 31.8 billion yen, bolstered by an increase in income from royalties and income from visual content related to The Super Mario Bros. Movie.

Nintendo Co., Ltd.

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Gross Profit

		FY23/Q1	FY24/Q1	Comparison
Gross profit		184.5 bn yen	281.0	bn yen	+52.3 %
Gross profit ratio	60.0 %	60.9	%	+0.9 pt.
		Main Variable Factors
		FY23/Q1	FY24/Q1	Comparison
Proportion of hardware	43.8 %	40.9		-2.9pt.
sales*1		%
Proportion of first-party	76.3 %	88.8		+12.5 pt.
software sales*2	%
Proportion of digital	53.0 %	47.3		-5.7pt.
sales*2		%
Average	1 USD	129.66 yen	137.34	yen	+7.68 yen
exchange rate	1 Euro	138.10 yen	149.48	yen	+11.38 yen
*1 Proportion of sales to total dedicated video game platform sales			5
*2 Proportion of sales to total dedicated video game platform software sales

• With the increase in net sales, gross profit rose by 52.3% year-on-year to 281.0 billion yen.
• Although the proportion of hardware sales declined and the proportion of first- party software sales increased, our gross profit margin remained at the same level year-on-year. This was due in part to the lower proportion of digital sales and Nintendo Switch ‒ OLED Model, which has a lower profit margin than the other models in the Nintendo Switch family of systems, accounting for a greater percentage of hardware sales.

Nintendo Co., Ltd.

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