Nintendo : Financial Results Explanatory Material (6.2MB)

Fiscal Year Ended March 2020

Financial Results Explanatory Material

Nintendo Co., Ltd.

May 7, 2020

1

Information About Risks Related to COVID-19

• Impact on parts procurement, production, and shipments
• Impact on consumption activities
• Impact on research and development
• Impact of foreign exchange fluctuations

2

1. Consolidated Financial Results and Outlook

3

Consolidated Financial Highlights

FY19FY20 Comparison

Net sales	1,200.5	bn yen	1,308.5	bn yen	+9.0	％
Operating profit	249.7	bn yen	352.3	bn yen	+41.1	%
Operating profit ratio	20.8	%	26.9	%	+6.1	pt.
Ordinary profit	277.3	bn yen	360.4	bn yen	+30.0	%
Net profit	194.0	bn yen	258.6	bn yen	+33.3	%
Net profit ratio	16.2	%	19.8	％	+3.6	pt.

*Net profit: Profit attributable to owners of parent

*FY = Fiscal Year: FY20 indicates the period between April 1, 2019 and March 31, 2020.

4

Consolidated Sales

FY19	FY20	Comparison

Net sales	1,200.5 bn yen	1,308.5	bn yen	+9.0 %
Dedicated video game platform*1	1,152.6 bn yen	1,254.1	bn yen	+8.8 %
Mobile, IP related income, etc.*2	46.0	bn yen	51.2	bn yen	+11.5 %
Playing cards, etc.	1.9	bn yen	3.0	bn yen	+57.1 %

*1 Each platform includes hardware, software (including downloadable versions of packaged software, download-only software, add-on content, and Nintendo Switch Online) and accessories.

*2 Includes income from smart-device content and royalty income.

Effect of changes in foreign exchange rates on net sales: -37.3 billion yen

FY20 Regional Sales Ratio

8.8%	Japan
23.0%
The Americas
25.0%
	Europe
43.2%	Other

Proportion of overseas sales: 77.0%

5

Gross Profit

		FY19	FY20	Comparison
Gross profit		501.1 bn yen	641.7	bn yen	+28.0 %
Gross profit ratio	41.7 %		49.0	％	＋7.3 pt.
		Main Variable Factors
		FY19		FY20	Comparison
Proportion of hardware	58.4 %		52.2		-6.2pt.
sales*1			%
Proportion of first-party	83.8 %		82.8		-1.0pt.
software sales*2		%
Proportion of digital	24.8 %		34.0		+9.2 pt.
sales*2			%
Average	1 USD	110.91 yen		108.74	yen	-2.17yen
exchange rate	1 Euro	128.41 yen		120.82	yen	-7.59yen
*1 Proportion of sales to total dedicated video game platform sales			6
*2 Proportion of sales to total dedicated video game platform software sales

Selling, General and Administrative Expenses / Operating Profit

	FY19	FY20	Comparison
Selling, general and		289.3		+15.0 %
administrative expenses	251.4 bn yen	bn yen
SG&A expenses-to-sales ratio	20.9 %	22.1	%	+1.2 pt.
Operating profit	249.7 bn yen	352.3	bn yen	+41.1 %
Operating profit ratio	20.8 %	26.9	%	+6.1 pt.

Effect of changes in foreign exchange rates on operating profit: approx. -20.0 billion yen

	FY19	FY20	Comparison
Research and development		84.1		+20.9 %
expenses	69.6bn yen	bn yen
Advertising expenses	75.4bn yen	76.0	bn yen	+0.8 %

7

Ordinary Profit and Net Profit

FY19

FY20

Comparison

Non-operating income

28.3bn yen

25.5

bn yen

-9.7%

included foreign exchange gains

5.4

bn yen

-

Non-operating expenses

0.6bn yen

17.4

bn yen

+2,541.9 %

included foreign exchange losses

-

15.8

bn yen

Ordinary profit

277.3 bn yen

360.4

bn yen

+30.0 %

Net profit

194.0 bn yen

258.6

bn yen

+33.3 %

Net profit ratio

16.2

%

19.8

%

+3.6 pt.

*Net profit: Profit attributable to owners of parent

Exchange rate

FY19

FY20

Comparison

Dividends

FY19

FY20

Comparison

1 USD

110.99

yen

108.83 yen

-2.16

yen

Annual

810 yen

1,090 yen

+280 yen

1 Euro

124.56

yen

119.55 yen

-5.01

yen

8

Consolidated Financial Forecast

FY20	FY21	Comparison
(Results)	(Forecast)

Net sales	1,308.5	bn yen		1,200.0		bn yen	-8.3%
Operating profit	352.3	bn yen		300.0		bn yen	-14.9%
Ordinary profit	360.4	bn yen		290.0		bn yen	-19.5%
Net profit	258.6	bn yen		200.0		bn yen	-22.7%
*Net profit: Profit attributable to owners of parent
*Estimated exchange rate for FY21: 1 USD = 105 yen, 1 Euro = 115 yen
	FY20
Dividends			FY21		Comparison
(Results)			(Forecast)
Annual	1,090	yen		840	yen	-250yen
	FY20
Nintendo Switch			FY21		Comparison
(Results)			(Forecast)
Hardware	21.03	mil		19.00		mil	-9.6%
units			units
Software	168.72	mil		140.00		mil	-17.0%
units		units

	9
*Software sales units for FY20 include the quantity bundled with hardware (3.40 million units).

2. Business Highlights

10

Sales Status of Nintendo Switch (Sell-in)

FY19

FY20

Comparison

Hardware

16.95

mil

21.03

mil

+24.0 %

units

units

Nintendo Switch

16.95

mil

14.83

mil

-12.5%

units

units

Nintendo Switch Lite

-

6.19

mil

-

Pokémon Sword/ Pokémon Shield

units

17.37million units

Software

118.55

mil

168.72

mil

+42.3 %

units

units

Regional Hardware Unit Sales

Regional Software Unit Sales

25

200

Animal Crossing: New Horizons

Mario Kart 8 Deluxe

20

150

11.77million units

8.08million units

15

100

Number of million-seller titles (FY20)

10

50

27titles

5

include 18 Nintendo titles and

0

0

9 titles by other software publishers

(mil units) FY19

FY20

(mil units) FY19

FY20

11

Japan

The Americas

Europe

Other

Japan

The Americas

Europe

Other

Nintendo Switch System Family Sell-Through

		Note: Sell-throughrefers to units sold by retailers to consumers.
Japan	North America	Europe

FY2019

FY2020

Apr.-JuneJul.-Sept.Oct.-Dec.Jan.-Mar.Apr.-JuneJul.-Sept.Oct.-Dec.Jan.-Mar.Apr.-JuneJul.-Sept.Oct.-Dec.Jan.-Mar.

Previous: 3.80mil units	Previous: 6.35mil units	Previous: 4.49mil units
Current: 5.06mil units	Current: 7.67mil units	Current:	5.37mil units
(+33%)	20	%)	(	+19
(+	%)

12

Source: Nintendo, Media Create

Animal Crossing Series Comparative Sell-Through (JP/US/EUR)

13.41

10

5

0

(mil units）

Lifetime total

First 6 weeks

13

Includes system bundles and digital sales / Source: Nintendo, Media Create

Digital Sales

	FY19	FY20	Comparison
Digital sales	118.8 bn yen	204.1	bn yen	+71.8 %
Proportion of digital sales	24.8 %	34.0	％	+9.2 pt.

*Proportion to total dedicated video game platform software sales

*Sales of downloadable versions of packaged software, download-only software,

add-on content and Nintendo Switch Online, etc.
Downloadable versions of packaged software	Download-only software, add-on content
and Nintendo Switch Online, etc.

30.0%

FY20

Component ratio

of digital sales

70.0%

14

Announced Title Releases for FY21

May 29

June 5

2020 in Japan

Release continuous updates	Part 1: Release by end of June 2020	Releases from June 2020 onward
Part 2: Release in fall of 2020
	15

Mobile, IP Related Income, etc.

	FY19	FY20	Comparison
Mobile, IP related income, etc.	46.0bn yen	51.2	bn yen	+ 11.5%

* Includes income from smart-device content and royalty income

•	Addition of monthly subscription service	•	Addition of multiplayer feature
•	Large increase in active players	•	More than one third of all sales in US

16

IP Expansion Initiatives

17

3. Reference

18

Million-Seller Nintendo First-Party Titles

units in ten thousands

Nintendo Switch

	FY20		Life-to-date
Global	including		Global
Japan	Overseas

Pokémon Sword/Pokémon Shield	1,737	452	1,285	1,737
Animal Crossing: New Horizons	1,177	384	793	1,177
Mario Kart 8 Deluxe	808	93	715	2,477
Luigi's Mansion 3	633	83	550	633
Super Mario Maker 2	548	116	432	548
Super Smash Bros. Ultimate	503	90	413	1,884
The Legend of Zelda: Breath of the Wild	464	45	418	1,741
The Legend of Zelda: Link's Awakening	438	43	395	438
Super Mario Party	370	62	309	1,010
New Super Mario Bros. U Deluxe	329	33	296	660
SUPER MARIO ODYSSEY	297	21	275	1,741
Fire Emblem: Three Houses	287	58	229	287
Ring Fit Adventure	273	89	184	273
Splatoon 2	143	45	98	1,013
Pokémon: Let's Go, Pikachu! Pokémon: Let's Go, Eevee!	134	14	120	1,197
Pokémon Mystery Dungeon: Rescue Team DX	126	36	89	126
MARVEL ULTIMATE ALLIANCE 3: The Black Order	108	4	104	108
ASTRAL CHAIN	108	16	91	108

[Note]Software sales units include the quantity bundled with hardware. Software sales units include their downloadable versions.

19

Key Indicators

Proportion of Overseas Sales

FY20

Q1	Q2	Q3	Q4
76.5%	76.9%	78.6%	74.0%

76.8%

77.8%

77.0%

FY19

Q1 Q2 Q3 Q4

76.6% 78.7% 77.7% 78.7%

77.8%

77.7%

77.9%

• Proportion of overseas (outside of Japan) sales to total sales

Proportion of Hardware Sales

FY20

Q1	Q2	Q3	Q4
50.5%	54.9%	57.4%	39.6%

53.2%

55.6%

52.2%

FY19

Q1	Q2	Q3	Q4
51.7%	62.4%	61.2%	51.1%

57.8%

59.9%

58.4%

*Proportion of hardware (including accessories) sales to total dedicated video game platform sales

Proportion of First-Party

Software Sales

FY20

Q1	Q2	Q3	Q4
74.1%	76.0%	87.4%	85.1%

75.2%

82.0%

82.8%

FY19

Q1	Q2	Q3	Q4
82.9%	71.0%	89.8%	80.3%

76.8%

84.6%

83.8%

• Proportion offirst-party software sales to total dedicated video game platform software sales

20

Digital Sales Indicators

Digital Sales

Proportion of Digital Sales

Proportion of Downloadable Versions

in yen

of Packaged Software Sales

FY20

FY20

FY20

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

30.6 bn

40.9 bn

53.2 bn

79.2 bn

38.3%

34.8%

22.3%

48.5%

56.4%

64.5%

71.7%

76.9%

71.6 bn

36.2%

61.0%

124.9 bn

28.6%

65.6%

204.1 bn

34.0%

70.0%

FY19

FY19

FY19

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

18.5 bn

20.6 bn

45.0 bn

34.6 bn

24.2%

26.0%

19.6%

37.2%

59.3%

59.1%

78.7%

62.6%

39.1 bn

25.1%

59.2%

84.2 bn

21.8%

69.6%

118.8 bn

24.8%

67.6%

*Digital sales include (a) downloadable version of packaged software (the downloadable version of software that is offered both physically and digitally), (b) download-only software, (c) add- on content and (d) Nintendo Switch Online, etc.

*Proportion of digital sales to total dedicated video game platform software sales

• Proportion of downloadable versions of packaged software sales to total digital sales as indicated on the left: a/(a+b+c+d)

21

Supplementary Information on Our Website

Earnings Releases, etc.		IR Events
・Earning Releases		・Corporate Management Policy Briefing Presentation Materials
・Timely Disclosure of Information, etc.		・Financial Results Explanatory Materials, etc.
Financial Highlights		Dedicated Video Game Sales Units
・Consolidated Statements of Income	(Annual/ Quarterly)	・Total Unit Sales	(Life-to-date)
・Consolidated Balance Sheet	(Annual/ Quarterly)	・Unit Sales	(Annual/ Quarterly)
・Consolidated Cash Flows	(Annual)	・Number of Titles Released	(Annual)
・Key Figures per Share	(Annual)
・Geographical Sales Breakdown	(Annual/ Quarterly)
・Sales Breakdown by Category	(Annual/ Quarterly)
Top Selling Title Sales Units		Historical Data(Updated at fiscal year-end)
・Top selling Nintendo software sales units	・Consolidated Statements of Income Transition
on an accumulated basis		・Consolidated Sales Transition by Region
		・Number of Software Titles Released

*Corresponding pages on our website can be accessed by clicking on the titles above. *Financial Highlights will be updated within 2 business daysof our financial announcement. *Information previously available in Supplementary Informationcan be found at the following locations:

・Consolidated Statements of Income Transition → Financial Highlights

・Foreign Currency Transaction Information → Earnings Releases (Others, page 13)

22

Launch Dates of Primary Nintendo Products by Region (Apr. 2019〜Mar. 2020)

Nintendo Switch

	Japan		The United States		Europe
	Title	Launch Date	Title	Launch Date	Title	Launch Date
	(Hardware)		(Hardware)		(Hardware)
	Nintendo Switch Lite	9/20/2019	Nintendo Switch Lite	9/20/2019	Nintendo Switch Lite	9/20/2019
	(Software)		(Software)		(Software)
	Nintendo Labo Toy-Con 04: VR Kit	4/12/2019	Nintendo Labo Toy-Con 04: VR Kit	4/12/2019	Nintendo Labo Toy-Con 04: VR Kit	4/12/2019
	Super Mario Maker 2	6/28/2019	Super Mario Maker 2	6/28/2019	Super Mario Maker 2	6/28/2019
	MARVEL ULTIMATE ALLIANCE 3: The Black Order	7/19/2019	DRAGON QUEST BUILDERS 2 *	7/12/2019	DRAGON QUEST BUILDERS 2 *	7/12/2019
	Fire Emblem: Three Houses	7/26/2019	MARVEL ULTIMATE ALLIANCE 3: The Black Order	7/19/2019	MARVEL ULTIMATE ALLIANCE 3: The Black Order	7/19/2019
	TETRIS 99	8/9/2019	Fire Emblem: Three Houses	7/26/2019	Fire Emblem: Three Houses	7/26/2019
	ASTRAL CHAIN	8/30/2019	ASTRAL CHAIN	8/30/2019	ASTRAL CHAIN	8/30/2019
	The Legend of Zelda: Link's Awakening	9/20/2019	TETRIS 99	9/6/2019	DAEMON X MACHINA *	9/13/2019
	Ring Fit Adventure	10/18/2019	DAEMON X MACHINA *	9/13/2019	The Legend of Zelda: Link's Awakening	9/20/2019
	Luigiʼs Mansion 3	10/31/2019	The Legend of Zelda: Link's Awakening	9/20/2019	TETRIS 99	9/20/2019
	Pokémon Sword	11/15/2019	DRAGON QUEST XI S:	9/27/2019	DRAGON QUEST XI S:	9/27/2019
	Pokémon Shield	11/15/2019	Echoes of an Elusive Age - Definitive Edition *	Echoes of an Elusive Age - Definitive Edition *
	Dr Kawashima's Brain Training for Nintendo Switch	12/27/2019	Ring Fit Adventure	10/18/2019	Ring Fit Adventure	10/18/2019
	Tokyo Mirage Sessions #FE Encore	1/17/2020	Luigiʼs Mansion 3	10/31/2019	Luigiʼs Mansion 3	10/31/2019
	Pokémon Mystery Dungeon: Rescue Team DX	3/6/2020	Pokémon Sword	11/15/2019	Pokémon Sword	11/15/2019
	Animal Crossing: New Horizons	3/20/2020	Pokémon Shield	11/15/2019	Pokémon Shield	11/15/2019
			Tokyo Mirage Sessions #FE Encore	1/17/2020	Dr Kawashima's Brain Training for Nintendo Switch	1/3/2020
			Pokémon Mystery Dungeon: Rescue Team DX	3/6/2020	Tokyo Mirage Sessions #FE Encore	1/17/2020
			Animal Crossing: New Horizons	3/20/2020	Pokémon Mystery Dungeon: Rescue Team DX	3/6/2020
					Animal Crossing: New Horizons	3/20/2020
					[Note] Launch dates may differ within the United States and Europe regions depending on territories or countries.
					*This title is licensed to be sold as a Nintendo product.
Launch Schedule of Primary Nintendo Products by Region (extracts: Apr. 2020〜)
	Nintendo Switch
	Japan		The United States		Europe
	Title	Launch Date	Title	Launch Date	Title	Launch Date
	(Software)		(Software)		(Software)
	Xenoblade Chronicles Definitive Edition	5/29/2020	Xenoblade Chronicles Definitive Edition	5/29/2020	Xenoblade Chronicles Definitive Edition	5/29/2020
	Clubhouse Games: 51 Worldwide Classics	6/5/2020	Clubhouse Games: 51 Worldwide Classics	6/5/2020	51 Worldwide Games	6/5/2020
	Famicom Tantei Club: Kieta Koukeisha	2020	BRAVELY DEFAULT II *	2020	BRAVELY DEFAULT II *	2020
	Famicom Tantei Club: Ushiro ni Tatsu Shoujo	2020	Bayonetta 3	TBA	Bayonetta 3	TBA
	Bayonetta 3	TBA	Metroid Prime 4 (temp.)	TBA	Metroid Prime 4 (temp.)	TBA
	Metroid Prime 4 (temp.)	TBA	The sequel to The Legend of Zelda: Breath of the Wild (temp.)	TBA	The sequel to The Legend of Zelda: Breath of the Wild (temp.)	TBA
	The sequel to The Legend of Zelda: Breath of the Wild (temp.)	TBA
					[Note] Launch dates and titles etc. are subject to change.
					Launch dates may differ within the United States and Europe regions depending on territories or countries.
					*This title is licensed to be sold as a Nintendo product.
Upcoming Software Publishers' Title Lineup (extracts: Apr. 2020〜)
	Nintendo Switch
	Japan		The United States		Europe
	Title	Publisher	Title	Publisher	Title	Publisher
	KOWLOON YOHMA GAKUENKI: ORIGIN OF ADVENTURE	ARC SYSTEM WORKS	Borderlands Legendary Collection	2K	Borderlands Legendary Collection	2K
	Catherine: Full Body for Nintendo Switch	ATLUS	Bioshock: The Collection	2K	Bioshock: The Collection	2K
	Kotoba no Puzzle: Mojipittan Encore	BANDAI NAMCO Entertainment	XCOM 2 Collection	2K	XCOM 2 Collection	2K
	NAMCOT COLLECTION	BANDAI NAMCO Entertainment	Levelhead	Butterscotch Shenanigans	SuperMash	Digital Continue
	Mr. DRILLER DrillLand	BANDAI NAMCO Entertainment	SuperMash	Digital Continue	Streets of Rage 4	Dotemu
	Utano Prince Sama	BROCCOLI	Streets of Rage 4	Dotemu	Burnout Paradise Remastered	Electronic Arts
	Amazing Aria & Sweet Serenade LOVE for Nintendo Switch	Burnout Paradise Remastered	Electronic Arts	Ninjala	GungHo Online Entertainment
	BRIGANDINE The Legend of Runersia	HAPPINET	Ninjala	GungHo Online Entertainment	Minecraft Dungeons	Mojang Synergies / Xbox Game Studios
	Hakuoki Shinkai Ginseinosho	IDEA FACTORY	Minecraft Dungeons	Mojang Synergies / Xbox Game Studios	The Outer Worlds	Private Division
	Harukanaru Toki no Naka de 7	KOEI TECMO GAMES	The Outer Worlds	Private Division	Trials of Mana	Square Enix
	FAIRY TAIL	KOEI TECMO GAMES	Trials of Mana	Square Enix	Moving Out	Team17
	eBASEBALL PAWAFURU PUROYAKYU 2020	KONAMI	Moving Out	Team17	NARUTO SHIPPUDEN: Ultimate Ninja STORM 4 ROAD TO BORUTO	Bandai Namco Entertainment
	Rodents 2	NIPPON COLUMBIA			Ghost of a Tale	Plug In Digital
	Zumba Burn It Up!	SEGA			The Elder Scrolls: Blades	Bethesda Softworks
	Trials of Mana	SQUARE ENIX			Railway Empire - Nintendo Switch Edition	Kalypso Media Group
	SYNAPTIC DRIVE	Yunuo International

[Note] Launch schedules, software names etc. are subject to change. Launch titles are listed by publisher alphabetically.

This list includes titles that are released as download-only software.