RESOLVING THE LEDGER
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See the full story · 1 sourceson Google Preferred Source Google News Link copied to clipboard By Ashely Claudino Published Aug 6, 2026, 8:37 AM EDT News Nintendo's fiscal year starts off on the right foot
There’s no question that Switch 2 is the biggest console launch ever An improved Minecraft is finally coming to Switch 2 Xbox's Halo remake is getting crushed by 2 Call of Duty ports, analyst says Nintendo reports incredible profits, and physical games still play a big part Sign in to your Polygon.com account Nintendo 's financial report for the first quarter of this fiscal year makes it clear that Switch systems still have a lot to give, as the original and its successor continue to hit incredible milestones.
Even though hardware sales decreased by 31–34% for both consoles in comparison to last year, this by no means indicates that either system is reaching the end of its lifetime. The Switch 2 release in the first quarter of the previous fiscal year means the previous report includes a launch week spike in sales, making year-on-year comparisons unfair. Therefore, it's still a feat that 3.82 million units were sold this quarter, and 23.68 million Switch 2 units were sold in total, overtaking the GameCube . On top of that, the console's predecessor, the original Switch, released nine years ago, so it is incredible to see that it still sold over 660,000 units in the first three months of this fiscal year.
Gamers aren't acquiring as many consoles compared to last year, but they are certainly buying more games. Switch 2 exclusive software sales rose by 9.2%, whereas sales of software for the original Switch went up by a staggering 38.6%. The rise of digital media has been the talk of the town among the gaming community following Sony's announcement to end disc production . Even though Nintendo's digital game sales have gone up considerably — by 90% compared to last year — physical copies still account for 40% of the company's game sales. Therefore, it is unlikely that Nintendo will follow in Sony's footsteps and stop game card production.
Nintendo has earned billions of yen through hardware and software sales this fiscal year, but that's not all. According to the financial report, following the United States Supreme Court's ruling on IEEPA tariff refunds , Nintendo received a $300 million refund, which led to a 150% increase in profits, as the cost of sales decreased considerably. Nintendo claims that players did not pay the initial tariffs and that "tariffs related to the refunds were primarily borne by the company rather than passed on to consumers through product prices."
Besides this boost to the company's profits, its IP-related income, which includes official merchandise, royalties, apps, movies and videos, rose by 107.4% as well. This was largely due to the success of The Super Mario Galaxy Movie , which was released in April 2026, right at the start of the fiscal year. Even though the film didn't make as much money as its predecessor, The Super Mario Bros. Movie , it was the second-highest grossing movie based on a video game. In total, it made over $1 billion in revenue.
Nintendo prides itself on its family-friendly content and values. Its goal is to get these animated films to catch the attention of fans as well as those who aren't familiar with this universe and its characters — maybe even give them a little push to pick up a controller for the first time. With The Legend of Zelda live-action movie in the works, Nintendo hopes to grab the attention of an even wider audience and surpass The Super Mario Bros. Movie in terms of box-office revenue.
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