Pandemic payoff continues for Nintendo as profit soars

Japanese giant Nintendo reported new bumper results Monday, with unprecedented demand for its hit games and consoles continuing to soar as new virus lockdowns boost the sector.

While new waves of infections have dashed economic recovery hopes in many industries, tightened restrictions have helped extend a run of good fortune for gaming companies.

Nintendo hiked its full-year forecast again on the strong results, including the runaway success of its Switch console and blockbuster pandemic hit "Animal Crossing".

The firm said global sales of the Switch for October-December rose to their high levels since the wildly popular console launched in March 2017.

Net profit hit 376.7 billion yen ($3.6 billion), up 91.8 percent from the April-December period a year earlier, while sales climbed 37.3 percent to 1.4 trillion yen, it said.

Nintendo, which revised its annual forecasts up last quarter, said it was further upgrading its net profit outlook to 400 billion yen for the fiscal year to March, from an earlier estimate of 300 billion yen.

Full-year sales are now projected at 1.6 trillion yen, compared with the 1.4 trillion yen forecast in November.

"Nintendo's performance has been strong as sales of its Switch console continue to rise," said Hideki Yasuda, an analyst at Ace Research Institute in Tokyo.

"Although it has not released major titles recently, software sales were also strong," he told AFP, noting that the company "appears to have sailed through the crucial Christmas season in style".

"The pandemic was a key factor but the current strong performance underscores the Switch's high popularity," Yasuda said.

Since it first hit stores nearly four years ago, the console has become a huge global seller, helped by innovative, family-friendly titles that have wowed critics and gamers alike.

In 2019, Nintendo released Switch Lite -- a scaled-back, cheaper version.

Investors are now shifting their focus towards signs of a new version of the Switch, as sales may start to decline for the next fiscal year, analysts said.

Nintendo's new console sales have tended to peak in the third year after release, and then taper off.

But the Kyoto-based company is counting on continued strong demand for the Switch throughout the season, with analysts saying the platform is on track to break the fourth-year jinx.

Rival Sony, which launched its much anticipated PlayStation 5 late last year, is scheduled to release its third quarter earnings this week.

Nintendo shares have surged more than 50 percent over the past 12 months and closed up 3.40 percent at 62,640 yen ahead of the earnings release.