Nintendo planned to sell over 24 million Switch game consoles and failed
Nintendo will report its financial results for the second quarter of the fiscal year ending March 2022 on November 4. In addition, Nintendo is reported set the production of Switch game consoles for the full year at 24 million units. It did not achieve the initially expected return.
In the last fiscal quarter, Nintendo’s net profit was 92.75 billion yen (about $ 0.81 billion), and the market was estimated at 82.56 billion yen ($ 0.72 billion) ; sales were 322.647 billion yen ($ 2.83 billion), down 9.9% year-on-year; operating profit was 119.752 billion yen ($ 1.05 billion), down 17.3% year-on-year.
Nintendo predicted that annual operating profit was 500 billion yen and the market was estimated at 624.16 billion yen; annual net sales were estimated at 1.6 trillion yen and the market at 1.77 trillion yen. Net profit was 340 billion yen and the market was estimated at 447.03 billion yen ($ 3.92 billion).
It’s worth mentioning that in the first quarter, Nintendo forecast annual Switch hardware sales of 25.5 million units. In the first quarter, Switch hardware sales were 4.45 million units, down 22% year-over-year.
In the fourth quarter of last year, Nintendo sold 4.73 million Switch hardware, which is also down from the previous quarter. Total Switch hardware sales reached 89.04 million units, and software sales reached 324 million units.
Nintendo Switch OLED costs more
When looking at the game console market, the prices can be confusing. In that sense, an article we wrote in July could be very helpful. At that time, we were talking about the new Nintendo Switch OLED models that hit the market earlier. The new model sports a 7-inch OLED display and brings a series of improvements. For this, the company charges $ 350. In other words, it’s $ 50 more than the original variant.
It made a lot of noise in the market. The company has always reduced prices in order to stimulate sales rather than increase them. We expected the cabinet to act this way in times of pandemic and lockdown. We mean that because of COVID-19, people have had to find ways to be entertained. It has made it possible to record profits, downloads and subscriber numbers for Sony and Nintendo.
Nintendo’s decision to increase the price from $ 300 to $ 350 therefore seems illogical. Of course, the new Nintendo Switch comes with an OLED panel and offers better performance than the original model. But is $ 50 the right amount to increase the price?