Illustration by Alex Castro / The Verge
Nintendo could be planning a deeper dive into the mobile gaming industry to make up for a slowdown in Switch sales. Along with its earnings report released on Tuesday (PDF), the company announced a joint venture with DeNA, the Japanese mobile gaming giant that co-developed several Nintendo titles for iOS and Android, including Super Mario Run, Fire Emblem Heroes, Animal Crossing: Pocket Camp, and Mario Kart Tour.
The joint venture will establish a new company called Nintendo Systems Co., Ltd, which is set to open in April 2023. Nintendo first partnered with DeNA in 2015 and says the joint venture will “strengthen the digitalization of Nintendo’s business,” which has already proven incredibly lucrative for the company. In May, data provided to mobilegamer.biz by Sensor Tower indicated that its mobile games had made almost $1.8 billion in global lifetime revenue. Fire Emblem Heroes, which was first released in 2017, became the first of Nintendo’s mobile games to reach $1 billion in global player spending, according to a June report from Sensor Tower.
Nintendo’s earnings report revealed a sharp decline in Switch sales, dipping 19.2 percent year over year. The company blames the drop on the chip shortage, which has also affected its Switch sales throughout the entirety of 2022. Nintendo just barely met its Switch sales target in May, and it reported a 23 percent year-over-year decrease in Switch sales in August. The gaming giant has since slashed its Switch sales forecast by 10 percent.
Nintendo hasn’t released a new mobile game with DeNA since 2019. Its most recent mobile game, Pikmin Bloom, was launched on Android and iOS in partnership with Pokémon Go developers Niantic. As noted by Sensor Tower, it reached $5.3 million in revenue in the six months following its release. But it looks like things are starting to slow down now, though, with Nintendo’s earnings report revealing that its mobile and IP-related sales dropped by 7.5 percent year over year.
Even with a slowdown in hardware and mobile gaming sales, Nintendo will likely have a strong holiday season as it works “to deliver as many consoles as possible to consumers in every region of the world.” It also released Bayonetta 3 last month and has Pokémon Scarlet and Pokémon Violet coming on November 18th.