Nintendo delivered a striking Q1 FY2026 (April–June) — operating profit surged 150% year-over-year, jumping from ¥56.9 billion to ¥142.5 billion (approximately $902 million). This happened despite net sales declining 9.5% to ¥517.8 billion ($3.28 billion).
How Profit Doubled While Sales Fell
The answer lies in a one-time windfall: tariff refunds in the US totaling roughly $300 million. Nintendo clarified that “the tariffs related to the refunds were primarily borne by the company rather than passed on to consumers through product prices.” Notably, Nintendo did raise the Switch 2 price recently, but attributed that to component cost increases rather than tariffs.
Hardware Sales: A Mixed Picture
- Switch 2: 3.82 million units sold (down 34.4% YoY)
- Original Switch: 0.66 million units sold (down 31.8% YoY)
Console hardware is clearly in a transition period as the Switch 2 ramps up and the original Switch winds down.
Software Sales: Strong Growth
Game sales tell a different story:
- Switch 2 titles: 9.46 million units (up 9.2% YoY)
- Original Switch titles: 33.81 million units (up 38.6% YoY)
The legacy Switch library continues to sell remarkably well, outpacing new Switch 2 software by a wide margin.
Standout Titles
- Tomodachi Life: Living the Dream — 7.94 million copies
- Pokémon Pokopia — 1.27 million copies
Digital Sales Surge
Digital revenue — including downloadable versions of packaged games, download-only titles, DLC, and Nintendo Switch Online — jumped 90% to ¥132.7 billion.
IP-Related Business Booms
Sales of IP-related business (licensing, merchandise, etc.) rose 107% to ¥34.8 billion, driven largely by the success of The Super Mario Bros. Movie.
Source: Nintendo Financial Results (PDF)
