Nintendo (NTDOY) is seeing strong demand for its latest game console the Switch, so much so that it raised its target for shipments for its fiscal year ending in March.
In conjunction with its earnings report, the Japanese video gaming company said it expects to ship 14 million units of the Switch in the fiscal year ending in March 2018, up from its past target for shipments of 10 million in that time frame. Add the four weeks of shipments in early March when the Switch was launched and Nintendo will have sold a total of 16.74 million units. For comparison, The Verge pointed out that 13.56 million units of the Wii U were shipped in nearly five years.
On the software front, Nintendo said it has sold 27.48 million Switch games so far with the company forecasting it will ship 50 million more titles for the game console by the end of March of 2018. "The Legend of Zelda: Breath of the Wild," is the leading game for the Switch with 4.7 million copies sold as of the end of September. "Mario Kart 8 Deluxe" came in second with 4.42 million copies sold, and "Splatoon 2" rounded out the top three with 3.61 million units sold. (See also: Nintendo in Race to Acquire Key Switch Components.)
For the fiscal second quarter, the Japanese company reported revenue of 219.9 billion Japanese yen or $1.9 billion, which was higher than the 174 billion yen analysts were expecting. The company’s operating profit of 23.7 billion also surpassed the 19 billion yen consensus. The strong showing was the result of Switch sales. For next year it raised its financial forecast, expecting net sales of 960 billion Japanese yen, higher than its past target of 750 billion yen. Operating profit is forecast to come in at 120 billion yen, up from the 65 billion yen Nintendo had previously targeted.
Ever since Nintendo launched its latest game console, which is a portable gaming system and home console rolled into one, the company has been seeing red-hot demand and has had to up its level of production. This past summer, the Financial Times reported the company was increasing the number of units it produces for Thanksgiving and Christmas sales, which often peak in late fall. At the time, it was reportedly targeting 18 million units of the Switch for the fiscal year ending in March 2018. Previously expectations were that it would ship 16 million units in its fiscal year. Citing sources from the supply chain, earlier this month DigiTimes reported the Japanese gaming company recently upped its orders for 2 million units to be produced each month due to surging demand. (See also: Nintendo Raised to Outperform by Credit Suisse.)