Nintendo profit fell 16% and Sony profit rose 83% in the same three months
Switch 2 shipments fell 41.2% and PS5 shipments fell 35.0%. Most of the gap between the two profit lines comes from what each number is measured against.
Hero image: Crisco 1492, CC BY-SA 4.0, via Wikimedia Commons.
Nintendo and Sony both reported on November 5 for the quarter ending September 30. Both shipped fewer consoles than a year earlier. One booked 16% less operating profit, the other 83% more. The explanations sit in the filings, and several of them are arithmetic.
The quarter, side by side
| July to September 2026 | Nintendo | Sony G&NS | Source |
|---|---|---|---|
| Revenue | ¥448.2bn, down 15.0% | ¥1,208.5bn, up 9% | Company releases |
| Operating profit | ¥73.9bn, down 16.3% | ¥220.1bn, up 83% | Company releases |
| Operating margin | 16.5% | 18.2% | Our calculation |
| Consoles shipped | 2.67m Switch 2 | 2.6m PS5 | Company releases |
| Change year on year | -41.2% | -35.0% | Our calculation |
| Lifetime consoles | 26.35m | 97.9m | Company releases |
| Software units | 24.49m Switch 2, six months | 88.2m, three months | Company releases |
| Full-year outlook | 16.5m units, unchanged | Segment profit raised to ¥700bn | Company releases |
Margins: 73.9 ÷ 448.2 = 16.5% for Nintendo, 220.1 ÷ 1,208.5 = 18.2% for Sony. The software row mixes periods because Nintendo reports platform software by half year and Sony by quarter. There is no quarter-only Switch 2 software figure in the interim release, so we did not invent one.
Nintendo's 41% is measured against a launch quarter
2.67m shipped this quarter, 4.54m in the same quarter last year: 2.67 ÷ 4.54 - 1 = -41.2%.
July to September 2025 was the console's first full quarter on sale. Switch 2 launched on June 5, 2025, and the 26 days before that quarter ended already moved 5.82m units into retail. That is channel fill: stock in warehouses and stockrooms, not consoles in living rooms.
The quarter-on-quarter comparison uses a cleaner base. 3.82m in April to June 2026, 2.67m in July to September: 2.67 ÷ 3.82 - 1 = -30.1%.
Both figures describe a decline. They differ by 11 points, and the difference is the base. 2.67m is still the second-lowest quarter since launch, behind January to March 2026 at 2.49m.
The unchanged target needs a second half that grows
Nintendo held the full-year forecast at 16.5m units. With 6.49m shipped in the first half, the remainder is 16.5 - 6.49 = 10.01m.
The same six months a year earlier produced 7.01m in October to December plus 2.49m in January to March, so 7.01 + 2.49 = 9.50m. The implied second half is 10.01 ÷ 9.50 - 1 = +5.4%.
H1 shipments were down 37.4% year on year. That figure is Nintendo's. The +5.4% is ours, derived from the same forecast, and it is the number the December quarter can be checked against.
The target was already a cut when it was set in May: 16.5 ÷ 19.86 - 1 = -16.9% against the 19.86m Switch 2 sold in its first fiscal year.
One more line from the balance sheet. Inventory went from ¥539.8bn at the start of the fiscal year to ¥814.57bn at September 30, or 814.57 ÷ 539.8 - 1 = +50.9%. The release does not explain the build, and it does not split finished consoles from components, so the figure cannot be read as unsold hardware.
Sony's 83% is 29% by Sony's own arithmetic
The year-earlier quarter carried two charges: ¥31.5bn of impairment on part of Bungie's intangible assets, and ¥18.3bn from correcting development costs that had been capitalised. 31.5 + 18.3 = 49.8.
Sony's chief financial officer, Lin Tao, said in the briefing that excluding those ¥49.8bn, segment operating income rose 29%. The statement checks out: 220.1 ÷ 1.83 = 120.3, so last year's base was ¥120.3bn; 120.3 + 49.8 = 170.1; 220.1 ÷ 170.1 - 1 = 29.4%.
The rest of the gap comes from mix. Software reached 88.2m units against 80.3m, up 9.8%. First-party software went from 6.3m to 8.2m. The digital share of full games rose from 72% to 78%, and monthly active PlayStation accounts reached 127m from 119m. Hardware revenue fell 4.8% to ¥219.7bn.
The forecasts moved in opposite directions. Sony raised the segment's full-year operating income forecast to ¥700bn. Nintendo left both its unit target and its profit forecast where they stood in May.
What a console keeps earning after it is sold
Nintendo's own IR page, as of September 30: Switch 2 hardware 26.35m, software 73.21m. 73.21 ÷ 26.35 = 2.78 games per console.
The same page for the original Switch: 157.20m hardware, 1,593.87m software. 1,593.87 ÷ 157.20 = 10.14.
These two ratios are not measuring the same thing. Switch 2 has been on sale about 16 months, the original about nine and a half years, and the older machine spent most of its life as the only place to buy Nintendo games. 2.78 is a floor that rises for as long as owners keep buying.
Sony publishes software units each quarter but no lifetime attachment figure, so there is no third column here. For the quarter alone it reports 88.2m full games across PS4 and PS5, and that number cannot be converted into a lifetime ratio from public data because the console totals are cumulative.
Two answers to the same component bill
Nintendo has moved Switch 2 prices this year: Japan from ¥49,980 to ¥59,980 on May 25, which is 10,000 ÷ 49,980 = +20.0%; the United States from $449.99 to $499.99 on September 1, or 50 ÷ 449.99 = +11.1%; Europe from €469.99 to €499.99 on the same date, or 30 ÷ 469.99 = +6.4%. President Shuntaro Furukawa said memory supply is sufficient and no further increase is planned for now.
Sony says it absorbed the increase through promotions, pricing and cost cuts, and it raised the segment profit forecast. The component market behind both decisions is the same one we covered in the RAM pricing story and in the graphics card delistings.
Read together, the two announcements describe opposite moves on the same bill. Nintendo raised the list price and kept the volume target. Sony says it held hardware profitability roughly level and lifted the profit forecast.
What we could not verify
Nintendo's interim release names a refund of US tariffs paid under IEEPA as one reason first-half operating profit rose 49.1%, and does not put a figure on it. Press reports have used about $300m. We could not confirm that amount from Nintendo, so it appears in none of the arithmetic above. Readers who want to adjust the first-half comparison should treat the 49.1% as an upper bound.
Both companies report in yen, and no currency conversion is used anywhere in this piece. Nintendo World Report's summary quotes ¥158.284 to the dollar and labels its dollar figures as being for comparison only; we use neither.
Sony does not disclose net profit for the games segment, only for the group. The group figure of ¥449.6bn is not comparable to Nintendo's ¥73.5bn and is not placed beside it.
Attachment rates here divide sell-in by sell-in. They are not active users and not copies sold through to consumers.
For the quarter, hardware fell at both companies and the profit line followed the software. The next check is the December quarter: Nintendo's own plan needs +5.4%, and Sony has already raised the number it will be measured against.
