Japanese game maker Nintendo’s earnings hit by token crunch

Nintendo said its profit for the nine months to December fell 2.5% as a shortage of computer chips hurt production

TOKYO — Nintendo’s profit for the nine months to December fell 2.5% as a shortage of computer chips hurt production, the Japanese video game maker behind the Super franchises said Thursday. Mario and Pokemon.

Kyoto-based Nintendo Co. posted a profit of 367 billion yen ($3.2 billion) for the period, up from 377 billion yen a year earlier. Its sales over the same period fell 6% to 1.3 trillion yen ($11 billion).

Game makers reaped windfall profits from more people staying home during the pandemic. But sales of Nintendo Switch consoles had more momentum in the past fiscal year, driven by its hit “Animal Crossing: New Horizons.”

Console sales are often driven by hit games, although devices tend to sell better at first and then slowly decline in popularity.

Nintendo cut its Switch console sales forecast for the fiscal year through March to 23 million machines. It had forecast 24 million units, previously reduced from a projection of 25.5 million units.

Chairman Shuntaro Furukawa said shortages of computer chips have hampered production, complicating planning for the next fiscal year and beyond.

The issue has also slowed down the design process for its next gaming machine. Nintendo is developing a device to follow the Switch.

Despite the setbacks, more than 100 million Switch machines have been sold to date worldwide. Its most popular games for the last period were “Pokémon Brilliant Diamond” and “Pokémon Shining Pearl”, and the new games Mario Kart and Mario Party.

“Pokemon Legends Arceus,” which went on sale last month, and the latest Kirby game, slated for release in March, are expected to boost sales in the final fiscal quarter, according to Nintendo.

Nintendo faces fierce competition from longtime rivals such as Microsoft Corp. and Sony Corp. and newcomers like Netflix and Google.

Microsoft recently announced the acquisition of Activision Blizzard, maker of Candy Crush and Call of Duty, for $68.7 billion, making the Xbox maker one of the largest games companies in the world.

Sony, which makes the PlayStation series of consoles, is acquiring Bungie Inc., known for its Halo and Destiny games, for $3.6 billion. Such acquisitions add game titles under their wings and effectively eclipse Nintendo.

Nintendo expects to post a profit of 400 billion yen ($3.5 billion) on sales of 1.65 trillion yen ($14 billion) for the fiscal year to March.


Yuri Kageyama is on Twitter https://twitter.com/yurikageyama

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