While Nintendo is the gaming champion when it comes to evergreen titles that span decades of continued success, the company may be shifting its focus to new titles. Nintendo President Shuntaro Furukawa said in a recent Q&A with investors that although the company has sustained impressive and ongoing sales with its evergreen titles, this will not be viable forever. The president explained that as the Nintendo Switch enters the later years of its generation, there will be fewer new owners, meaning owners of the console will want brand new titles, rather than new installations of past franchises.
Nintendo appears to be looking to the future, despite the fact that their Q3 financial report saw the company increase their projected earnings from 200 million to 220 million units. This is in big part due to the massive success of Pokémon Legends: Arceus, as well the continued success of titles such as Mario Kart 8 Deluxe. The latter of which has remained successful enough to warrant a new DLC pack, seven years after its original release.
Furukawa said on the company’s success with evergreen titles, “Evergreen titles that were released in previous fiscal years have made up a larger share of overall software sales since the last fiscal year. So far this fiscal year, in the nine months between April and December, titles released in past years comprised approximately 60% of unit sales for first-party software (sell-through, see Note) in major regions. Looking at only the three months between October and December, evergreen titles comprised approximately 50%, due to strong sales of new titles.”
Further explaining Nintendo’s focus on new titles, “Regarding sales trends for evergreen titles, consumers who newly purchase Nintendo Switch hardware often choose to buy an evergreen title as their second or third game. In addition, as Nintendo Switch enters its sixth year, we believe there will be a decrease in the percentage of first-time purchases in terms of future demand for hardware, compared to what we have seen so far. We expect to see more purchases of multiple systems within the same household, as well as consumers replacing a previous Nintendo Switch system with Nintendo Switch – OLED Model. In these cases, consumers often already own the evergreen titles, so we believe that the ratio of evergreen title sales will decrease unless there is a major increase in first-time hardware purchases.”
Nintendo believes that “both first-time purchasers of Nintendo Switch and those who already own the hardware are interested in purchasing new titles. Going forward, it will be important to offer not only a variety of hardware but to also strengthen sales of both evergreen and new titles.” It will certainly be exciting to see what Nintendo has up its sleeve when it comes to totally new titles.
