Financial Results Briefing for Fiscal Year Ended March 2019

April 26, 2019

Nintendo Co., Ltd.

Director and President

Shuntaro Furukawa

Fiscal Year Ended March 2019

Financial Results Briefing

Thank you for making time to attend. I am Shuntaro

Furukawa, President of Nintendo. Mr. Takahashi, Senior

Executive Officer, has just presented our financial

results for the period. Now, I will cover the current

business situation, as well as the business outlook for

the new fiscal year.

Current State of the

Nintendo Switch Business

I’ll start with the current state of the Nintendo Switch

business. Nintendo Switch has continued to gain

momentum after January subsequent to the holiday

season. Business is going well, and we expect continued

growth. Let me discuss these points in order.

+35%

Nintendo Switch Console Sell-Through (JP/NA/EU)

(million

units)

FY Ended March

2019

FY Ended March

2018

April

through

June

July

through

September

October

through

December

January

through

March

Source: Nintendo , Media Create

As mentioned at the February corporate management

policy briefing, sales of the Nintendo Switch system

were strong during the holiday season, and sell-through

has continued to be solid through the start of this year.

This slide shows combined sell-through for the

Japanese, North American, and European markets. As

you can see, sell-through from January to March was

35% higher than the same period of the previous year.

Note:

Sell-through

refers to units sold by retailers to

consumers.

Financial Results Briefing for Fiscal Year Ended March 2019

Nintendo Switch Console Sell-Through (JP/NA/EU)

FY Ended March 2018

FY Ended March 2019

+23%

Apr May Jun Jul

Aug

Sep Oct

Nov

Dec

(million

units)

Jan Feb Mar

Source: Nintendo , Media Create

This graph shows cumulative sell-through trends

throughout the full fiscal year combined for Japan, North

America, and Europe. The fiscal year ended March 2018

showed explosive sales for a first year of hardware

sales. The fiscal year ended March 2019 kept up that

same pace until the beginning of autumn, before rising

even more sharply in November. As a result, we saw a

full-year increase of 23% over the previous fiscal year.

And since the start of the third year of Nintendo Switch

this March, the momentum of the business is still

increasing.

Nintendo Switch Console Sales Pace (JP)

Nintendo 3DS

Wii U

Nintendo DS

Wii

Nintendo Switch

(million

units)

Two year after

launch

One year after

launch

Source: Nintendo , Media Create

This graph shows changes in cumulative sell-through in

the Japanese market following the launch of Nintendo

Switch. The total hardware sell-through for Nintendo

platforms from Nintendo DS onward is superimposed on

the graph for comparison. Note that the quantity and

timing of holiday seasons that see large sales increases

will differ according to the different launch dates. Within

Japan, Nintendo Switch is not reaching the pace of

expansion set by Nintendo DS and Nintendo 3DS, but

has outpaced Wii.

Note: Japanese Launch Dates - Nintendo DS: December

2, 2004/Wii: December 2, 2006/Nintendo 3DS: February

26, 2011/Wii U: December 8, 2012/Nintendo Switch:

March 3, 2017

Nintendo Switch Console Sales Pace (NA)

(million

units)

Nintendo 3DS

Wii U

Nintendo DS

Wii

Nintendo Switch

Source: Nintendo

One year after

launch

Two year after

launch

Let’s turn now to the North American market. The red

line representing Nintendo Switch jumps significantly

twice, once at each holiday season. During the second

holiday season for Nintendo Switch, it approached the

momentum shown by Wii.

Note: North American Launch Dates - Nintendo DS:

November 21, 2004/Wii: November 19, 2006/Nintendo

3DS: March 27, 2011/Wii U: November 18,

2012/Nintendo Switch: March 3, 2017

Financial Results Briefing for Fiscal Year Ended March 2019

Nintendo Switch Console Sales Pace (EU)

(million

units)

Nintendo 3DS

Wii U

Nintendo DS

Wii

Nintendo Switch

Source: Nintendo

One year after

launch

Two year after

launch

These are the figures for the European market. Since its

second holiday season, Nintendo Switch has surpassed

the pace set by Nintendo 3DS.

Note: European Launch Dates - Nintendo DS: March 11,

2005/Wii: December 8, 2006/Nintendo 3DS: March 25,

2011/Wii U: November 30, 2012/Nintendo Switch:

March 3, 2017

Nintendo Switch Console Sales Pace (JP/NA/EU Totals)

Source: Nintendo , Media Create

Includes Canada

Nintendo 3DS

(million

units)

Wii U

Nintendo DS

Wii

Nintendo Switch

One year after

launch

Two year after

launch

And the total numbers combined for the three regions I

just explained look like this. Although there are

variances from region to region, Nintendo Switch is

spreading at a pace comparable to that of our previous

hardware.

26%

16%

13%

11%

Source: Nintendo

Title(s) Played On First Day Of Console Usage (JP/NA/EU, Jan-Mar)

Percentage of titles played on the first day among consoles with a

registered Nintendo Account and connected to the network/

In cases where multiple titles were played, each counts as one/

Free to start titles are excluded/ Source: Nintendo

Pokémon: Let's Go, Pikachu!/

Let's Go, Eevee!

Mario Kart 8 Deluxe

Super Smash Bros. Ultimate

The Legend of Zelda: Breath of the Wild

Super Mario Odyssey

Super Mario Party

New Super Mario Bros. U Deluxe

After the start of the calendar year, the title driving the

most hardware sales is

Super Smash Bros. Ultimate

This is a list of titles played by consumers on their first

day after purchasing Nintendo Switch, between January

and March 2019. As you can see,

Super Smash Bros.

Ultimate

was the title most commonly played by users

with new Nintendo Switch systems.

When

Super Smash Bros. Ultimate

was first released, it

was played by people within a wide age range, and

particularly by men in their 20s to early 30s. As time has

passed, however, the range of consumers playing this

game has widened even further. Our data shows that

the range of consumers showing interest in this game is

also increasing, which means the title draws such a

broad range of people.

Financial Results Briefing for Fiscal Year Ended March 2019

Nintendo Switch Continued Gaining

Momentum After Start of New Year

To sum up the sales status for Nintendo Switch itself,

growth in hardware sales after the turn of the year has

not peaked, but rather continues to pick up speed.

+50%

Nintendo Switch First-Party Software Sell-Through (JP/NA/EU)

(million

units)

FY Ended March

2019

FY Ended March

2018

April

through

June

July

through

September

October

through

December

January

through

March

Includes console bundles and digital sales / Source: Nintendo , Media Create

Sell-through of first-party Nintendo Switch titles has

remained good, with both new and previously-released

titles performing well even after January subsequent to

the holiday season, and ultimately exceeding last year’s

Q4 growth by 50%.

FY Ended March 2018

FY Ended March 2019

Nintendo Switch First-Party Software Sell-Through (JP/NA/EU)

(million

units)

Includes console bundles and digital sales / Source: Nintendo , Media Create

+70%

Apr May Jun Jul

Aug

Sep Oct

Nov

Dec Jan Feb Mar

This graph shows the trend in cumulative sell-through

over one year. The pace throughout the fiscal year

ended March 2019 was better than the previous year,

and it accelerated considerably during the holiday

season. Full-year sell-through was up 70% over the

previous year.

Financial Results Briefing for Fiscal Year Ended March 2019

• Became a million seller within

two weeks after release

Includes digital sales / Does not include sell-through in some regions, including Asia and Latin America. / Source: Nintendo , Media Create

(As of the end of March)

• Maintaining a steady pace,

with sell-through of more

than 2.5 million units.

• Released in January 2019

New Super Mario Bros. U Deluxe

sold over a million

copies within two weeks of its release in January 2019,

and has continued to maintain a steady pace. As of the

end of March, cumulative sell-through had passed 2.5

million units globally. It

has also helped drive hardware

sales since the start of the year, and we have confirmed

that it is contributing to active engagement with

Nintendo Switch.

• Outperformed past titles at

release

• Relatively high percentage

of female consumers in

Japan and abroad

• Released in March 2019

Initial sales of

Yoshi’s Crafted World

, released at the

end of March, have like many of the other Nintendo

Switch games released so far, outperformed that of past

titles in the series. In addition, the percentage of female

consumers is relatively high for this title compared to

other Nintendo Switch titles, both in Japan and

overseas.

100

110

120

Digital Sales Trends

118.8 billion yen

(Billion

Yen)

Launch

FY Ended

March 2013

FY Ended

March 2014

FY Ended

March 2015

FY Ended

March 2016

FY Ended

March 2017

FY Ended

March 2018

FY Ended

March 2019

Source: Nintendo

Digital sales have expanded greatly since the launch of

Nintendo Switch. This graph compares sales of digital

content within our dedicated video game platform

business over the years. Sales nearly doubled in the

fiscal year ended March 2019 compared to the previous

fiscal year, and exceeded 100 billion yen for the first

time ever. The Nintendo Switch business has expanded

over the previous year not only in download versions of

packaged software, but also in download-only software

and add-on content, plus contributions from Nintendo

Switch Online.

Note: Sales include pro-rated Nintendo Switch Online

memberships, based on the portion of the subscription

term that has elapsed.

Financial Results Briefing for Fiscal Year Ended March 2019

Sales per

Hardware Unit

Platform

Total sales (yen)

Software Attach Rate

Software units sold

Hardware units soldHardware units sold

＝＝

I’d now like to address the Nintendo Switch business

from a slightly different angle. One conventional metric

used in the dedicated platform business is the

tie ratio

or the attach rate of software per unit of hardware. This

is calculated by dividing the number of software units

sold by the number of hardware units sold. However,

with the rise in digital sales, we are witnessing the rapid

sales growth of indie titles at a wide range of price

points, and add-on content sales that cannot be counted

with the number of software units sold. As a result,

software attach rate calculated using conventional

methods no longer adequately reflects the actual state

of our business.

Instead, we would like to look at "sales per hardware

unit," which is the overall sales for the platform divided

by sales of the hardware itself. Note that this is

calculated based on sales recognized by the company,

and it differs from individual consumer spending.

37,000

39,800

42,100

41,700

49,000

55,000

Sales Per Hardware Unit (Cumulative)

Wii

Source: Nintendo

Yen

1st FY

Sales

2nd FY

Sales

3rd FY

Sales

Japan/ The Ameri cas/E urope cum ula ti ve tot al sal es at the end of ea ch fis cal ye ar, adjus ted for exch ange rat es ba sed on the

av erage rat e for th e f iscal ye ar ended March 2019, di vid ed by con so le sel l -in nu mbers ./S ource: Ni ntend o

Nintendo Switch

This graph shows the sales trends per Nintendo Switch

system for each fiscal year. It is based on the total

numbers at the end of the fiscal year for each of the

three major regions, adjusted to account for differing

exchange rates. For comparison, sales per Wii system

are shown in gray. The figures on the slide include

hardware and software sales, sales of accessories like

Joy-Con controllers and the Nintendo Switch Pro

Controllers, sales of titles from other software

publishers physically manufactured by Nintendo on

commission, add-on content sold digitally, and Nintendo

Switch Online revenue.

A straightforward comparison is difficult due to the

original prices and bundle specifications of Nintendo

Switch and Wii hardware being different. That said, you

can see that Nintendo Switch has seen a significant rise

in sales per hardware unit year by year, and sales are

higher than for Wii.

Financial Results Briefing for Fiscal Year Ended March 2019

• Software sell-through even stronger

than hardware

• Digital sales expanding greatly

• High level of sales per hardware unit

Allow me to summarize what we’ve covered so far.

Software sales momentum is stronger than hardware

sales momentum. Digital sales increased substantially

from the previous fiscal year, approximately doubled. In

addition, Nintendo Switch has high sales per hardware

unit.

Incidentally, the number of monthly active users

between January and March this year was double that of

the same month last year, confirming that now after the

second holiday season consumers are continuing to play

Nintendo Switch.

Current State Of Nintendo Switch

⚫ Hardware installed base has

continued to grow faster since

the new year

⚫ Nintendo Switch business

expanding on hardware spread

As we have discussed, you can see that Nintendo

Switch hardware is being purchased by many

consumers, and we have built a solid business on its

growth. Overall, we can say that the Nintendo Switch

business is very sound.

Outlook for the Fiscal Year

Ending March 2020

Let’s turn to the outlook for the fiscal year ending March

2020.

Financial Results Briefing for Fiscal Year Ended March 2019

The Nintendo Switch business

remains in a growth phase

Currently, the Nintendo Switch business remains in a

growth phase. This term, we can expect hardware

adoption to once again expand at a faster pace than the

previous fiscal year.

So that more and more people

around the world will realize

that Nintendo Switch is

something relevant to them

Nintendo Switch is a home gaming system that can also

be brought away from the front of the TV and played on

the go. If we can specifically and more broadly convey

messages of what kind of play experiences this game

system can offer in what kind of situations in the

consumers’ everyday lives, we believe more and more

people worldwide will come to view Nintendo Switch as

something relevant to them.

In the new fiscal year, in addition to the evergreen titles

that have been enjoying long, continued sales, Nintendo

and other software publishers will release many new

titles, including the ones that I will introduce shortly,

that can convey the fun of playing Nintendo Switch to

even more people. We will make efforts to bring the

broader awareness of a variety of different

entertainment experiences that the unique combination

of Nintendo Switch hardware and a variety of different

software can offer, not just among video game fans but

even among people who have never before been

interested in video games.

Financial Results Briefing for Fiscal Year Ended March 2019

One pair of major titles being released this new fiscal

year is

Pokémon Sword

and

Pokémon Shield.

These new titles, first announced in a Pokémon Direct in

February, have generated a huge response from

consumers.

Pokémon: Let’s Go, Pikachu!

and

Pokémon:

Let’s Go, Eevee!

, which were released in November of

last year, are designed to highlight the fun of Nintendo

Switch in TV mode, for example by waving the controller

at the TV screen to capture Pokémon.

Pokémon Sword

and

Pokémon Shield

are being developed to emphasize

the fun of playing Nintendo Switch in handheld mode.

We want these games to be played not only by longtime

Pokémon

fans, but also by consumers whose first

encounter with the series was on a dedicated video

game platform with

Pokémon: Let’s Go, Pikachu!

and

Pokémon: Let’s Go, Eevee!

Super Mario Maker 2

is scheduled for release in June.

This title is a completely new sequel to

Super Mario

Maker

, which was released on the Wii U and Nintendo

3DS systems.

This title is filled with new gameplay mechanics and

new ways to play that were not previously available in

the series. The game takes full advantage of the

features of Nintendo Switch to allow anyone to freely

create and play their own custom Super Mario levels.

Financial Results Briefing for Fiscal Year Ended March 2019

We also released a fourth Nintendo Labo kit this month,

Nintendo Labo Toy-Con 04: VR Kit

. Users can construct

five Toy-Con from cardboard parts, including a Toy-Con

Blaster, Toy-Con Camera, and Toy-Con Bird, then pair

them with Nintendo Switch to enjoy unique experiences

in a VR space through their body movements. For

example, while controlling the in-game action, users can

press a pedal with their foot to create and feel an actual

breeze. This is probably different from the image you

have of a VR device. Users can also create their own

games in VR.

The three Nintendo Labo kits released last year received

an Innovation Award at the Game Developers

Conference in the US this March, and a BAFTA Family

award and Game Innovation award at this month’s

British Academy Games Awards. The product has been

recognized for its innovation in many countries and we

are exceptionally proud of these achievements.

Nintendo Labo is even being used in schools, and we

are continuing to pursue sales so that even more

consumers can enjoy the series.

Note: BAFTA stands for British Academy of Film and

Television Arts.

Latest in the SeriesLatest in the Series

First-Party Titles Announced for the New Fiscal Year

As you can see, we will constantly release new titles

during the fiscal year ahead. And there are still more

titles that we haven’t yet discussed. We intend to

continue to expand the lineup of software that can be

enjoyed by consumers around the world and that will

keep people playing Nintendo Switch.

Financial Results Briefing for Fiscal Year Ended March 2019

Add-on Content and Free Updates

In addition, we will continue with efforts designed to

keep consumers playing software long after it has been

released. For example, we released a major free update

Super Smash Bros Ultimate

that adds a Stage Builder

and the ability to edit and post gameplay videos,

simultaneous with the release of the first set of paid

add-on content this month.

Mario Tennis Aces

was

released back in June of last year, but we have

continued to hold tournaments and distribute new

characters, and in a major free update added a new kind

of gameplay, also this month. By releasing content

online and holding events that build excitement for a

game, we are making the game fresh for consumers and

encouraging them to keep playing.

A Selection of Titles from Other Software Publishers

to Be Released This Fiscal Year

We are also bringing an even richer variety of new titles

from other software publishers as we enter the third

year of Nintendo Switch. What you see here is just a

sample. These will range from evergreen titles for video

game fans to titles that can be enjoyed by anyone,

regardless of age or gender, characteristic titles created

by indie developers, a variety of genre-specific games,

and more. By bringing them together, the Nintendo

Switch library will continue to meet consumers’ diverse

tastes.

Many publishers are developing titles for Nintendo

Switch because it has met our expectations of

widespread adoption, and because we made our

development environment available from the very

beginning. The number of Nintendo Switch development

kits shipped to publishers continues to greatly exceed

the number of kits for any of our previous platforms, and

many developers are creating titles for Nintendo Switch.

Financial Results Briefing for Fiscal Year Ended March 2019

Source: Nintendo

Membership now exceeds 9.8 million accounts

Half a year has passed since Nintendo Switch Online

went live last September. Global memberships now

exceed 9.8 million accounts, excluding free trial

memberships.

Note: This number includes family memberships.

A variety of

services for

members

Tetris 99

has been available for free since February as a

special offer to Nintendo Switch Online members. This

game pits 99 players against each other in online battle.

It has been played by 2.8 million accounts and has

helped boost engagement for Nintendo Switch. We plan

to implement in-game events to encourage consumers

to keep enjoying the game.

Nintendo Switch Online members are also enjoying

Nintendo Entertainment System - Nintendo Switch

Online. Nintendo Entertainment System - Nintendo

Switch Online gives members instant access to a variety

of classic NES games with added online play.Through

these initiatives we are working to make these services

more attractive over the long-term on Nintendo Switch

Online.

A collaboration with Tencent to

launch Nintendo Switch in China

is in progress

As we announced today, a collaboration with Tencent to

launch Nintendo Switch in China is in progress. We

expect to maximize our business in China by working

with Tencent Holdings Limited, which holds one of the

largest positions in China’s network communication and

game markets. Since the launch timing is undetermined,

we have not factored this business into our financial

forecasts for this new fiscal year.

Financial Results Briefing for Fiscal Year Ended March 2019

Early Sumer 2019 Summer 2019

Mobile Business

Next, I will cover our mobile business. We are

continuously implementing events and updates and

adding more ways to satisfy consumers as we work to

optimize how we operate each application. Overall

revenue from the mobile business has expanded

compared to the previous fiscal year. As previously

mentioned, we will release both

Dr. Mario World

and

Mario Kart Tour

this summer. This means we will be

operating a total of six applications globally starting this

summer.

Scheduled for May 21 - June 4 2019 (PDT)

As we announced the other day, we are accepting

applications for closed beta testing of

Mario Kart Tour

The closed beta is scheduled to start on May 21 (Pacific

Daylight Time). Based on the information we gather

from this testing and from the opinions of the

participants, we will proceed with final preparations for

release.

The six applications including

Mario Kart Tour

deal with

different IP, and the goals and the characteristics for the

applications also differ. Going forward, we will leverage

the ubiquity of mobile devices to expand the number of

people who have access to Nintendo IP through multiple

applications like these.

IP Expansion Business

We are continuing to implement a variety of initiatives in

our IP expansion business. Starting in April, we

launched a T-shirt collaboration with UNIQLO CO., LTD.

in various regions of the world earlier this month. We

will continue our efforts to increase opportunities for

people to have access to Nintendo IP and increase the

value of that IP, which is the source of our competitive

edge.

Financial Results Briefing for Fiscal Year Ended March 2019

Finally, let me talk about the E3 video game trade show

that will be held in Los Angeles this June. Once again,

Nintendo will not be hosting a large-scale conference

for institutional investors, securities analysts, and the

media. Instead, we plan to continue our practice of the

past few years, which is to release a video presentation

discussing the games that are planned for release

during the fiscal year, provide hands-on opportunities,

and so on. The world championship tournaments

for

Super Smash Bros. Ultimate

and

Splatoon 2

will be held

on June 8, right before the start of E3.

This concludes today’s presentation. Thank you.

Note: E3 is the Electronic Entertainment Expo. It is a

trade show for the video game industry that is held

every year in the United States.

Disclaimers

The contents of this briefing as well as of the accompanying documents and materials are based

upon the information available and the judgments which can be made at the time of the

announcement. Nintendo is not responsible for updating or changing these materials if the

information presented changes due to future circumstances or for other reasons.

Also, forecasts referred to in this briefing and accompanying documents and materials involve known

and unknown risks and uncertainties. Please note that such risks and uncertainties may cause actual

results to be materially different from the forecasts.