Nintendo Q1 profit surges past forecasts

Nintendo posted net income of ¥147.4 billion for the fiscal first quarter ended June 30, 2026. That result was well above analyst consensus expectations, which had projected net profit of around ¥78 billion. Revenue for the quarter came in at ¥517.8 billion, exceeding market forecasts that had centered in the mid‑¥440 billion range.

Despite the earnings beat, quarterly revenue declined by nearly 10% compared with the same period a year earlier. Even with this year‑on‑year drop, the top line was stronger than anticipated, contributing to a result that outperformed market expectations on both revenue and profit metrics.

A significant factor behind the upside in profit was a reduction in cost of sales linked to US tariff refunds. These refunds stemmed from tariffs that had been imposed on Nintendo products last year and subsequently rescinded, allowing the company to reverse a portion of previously recognized costs.

The reduction in cost of sales from these tariff refunds provided a direct lift to net income in the June quarter. This effect helped offset pressure from other cost elements that had been incorporated into Nintendo’s financial planning for the period.

Nintendo’s results were reported against a backdrop of higher component prices and tariffs, particularly affecting inputs such as memory. These cost pressures were accounted for within cost of sales, shaping the company’s margin profile for the quarter alongside the tariff refunds.

The June quarter continued the commercial rollout of the Switch 2 console. While detailed hardware and software unit figures are not fully verified across sources, reporting tied the platform’s performance to the broader revenue outcome and to the mix between console hardware and game sales.

Strong sales of a pair of in‑house titles for the flagship Switch 2 console were highlighted as important contributors to the quarter. These games supported engagement on the new hardware platform and underpinned part of the revenue generated from Nintendo’s proprietary software lineup.

The performance of these titles underscored the continuing importance of first‑party content to Nintendo’s financial results. Combined with the tariff‑related cost benefits, software strength helped deliver profitability that significantly exceeded consensus expectations, even as overall revenue slipped year on year.