Nintendo Shares Explode on Strong Switch Lite Numbers

Shares of Nintendo were heading higher this week after the company reported strong Switch Lite sales. The company’s stock had seen a gain of 7.6% by the market close in Japan on Friday.

It was on Thursday that Nintendo had announced that its operating profit doubled both on a year-on-year and quarter-on-quarter basis.

Between the Switch Lite’s launch on Sept. 20 and the end of the quarter, the company revealed that it had sold 1.95 million units of its handheld-only device. Meanwhile, 4.98 million units of the hybrid console Switch were sold in the six months to September.

“We expect Switch Lite sales volume to reach 3 (million) full-year, so the 2Q sell-in total of 1.95 (million) was a surprise,” remarked Morgan Stanley analysts.

According to Morgan Stanley analysts, Nintendo’s operating profit ratio of 24.6% for the second quarter was “well-above” levels seen in the same period a year ago at 14% as well as against the previous quarter’s 15.9%.

The analysts cited that the improvement was “helped significantly” by recent installments in the Super Mario Maker, Fire Emblem and Legend of Zelda franchises.

Nintendo President Shuntaro Furukawa stated, “Looking at the state of this initial response, I would say Nintendo Switch Lite generating its own demand, without negatively impacting sales trends for Nintendo Switch,” Furukawa said. “In fact, sales of Nintendo Switch (shown in gray) grew noticeably in the week following the launch of Nintendo Switch Lite. That was the same week as the release of Dragon Quest XI S: Echoes of an Elusive Age – Definitive Edition and the launch of a special Dragon Quest-edition Nintendo Switch in the Japanese market.”