Nintendo's pricier and newer Switch console did not hit the numbers that it was expected to despite its pre-orders selling out in minutes.
This is a surprising result due to low-level supply stemming from chip shortages. This is a surprising result due to low-level supply stemming from chip shortages.
Nintendo Switch's Low Sales
The OLED edition of the console was released worldwide on Oct. 8 for $350. In the domestic market, the company sold 138, 409 units, according to Kotaku.
Meanwhile, the weekend sales of the original Switch console hit 330,637 units in 2017. The sales of Switch Lite hit 177,936 units in 2019.
The numbers are a massive blow to Nintendo, whose shares have dipped more than 20% earlier this year while its competitors like Sony have increased.
The new console has a more vibrant display as it has a 7-inch OLED screen with a flexible stand. It has more storage space, better speakers, and a built-in internet cable port, according to Japan Times.
With its wider display, it makes playing games and watching Netflix on your Nintendo Switch console so much better.
Even without a widely expected graphics chip upgrade, the new console has been a trending topic on social media in major markets like the United States and Japan, where early impressions have been very positive.
Serkan Toto, an industry consultant, said that the new OLED model would become more popular than the two previous models. They expect that the existing owners of the consoles would upgrade from older units to the newer ones or add another one to their households.
When it comes to offering unique products, Nintendo and Tesla are similar, and both have a rabid fan base.
Nintendo's Inventory Issues
The popularity of the new Switch is causing inventory problems for Nintendo's Kyoto headquarters.
On the one hand, Nintendo finds it difficult to produce enough OLED units to meet the demand. Japanese retailers implementing lottery draws to know who can purchase one.
That includes the company's own flagship store in the Shibuya district of Tokyo. The thin supply of the new console is expected to extend until early 2022, according to an official from Nintendo.
Nintendo's production is divided between the upgraded new console, the $300 original console, and the $200 Switch Lite console. This shows that the company did not anticipate the OLED console outselling the others by a massive margin.
Before the OLED's launch, investors expressed concern about the console because it did not show any impressive upgrade from the original unit. It is also leading to a potential issue of a large inventory of unsold Switch consoles.
Famitsu's figures show that both the original Switch and Switch Lite sales are on a consistent downward trajectory this year.
Unlike last year, which was affected by the pandemic, the two consoles are available in ample supply everywhere.
Switch was launched four years ago and has since sold more than 90 million units.
The console looks ready to sustain momentum with its newest model, while the original one requires a price cut in order to sell, according to Bloomberg.
A spokesman from Nintendo said that the company has no plans to reduce the prices of the console.
The company cut the standard model price in September because of the change in Europe's currency exchange rate.
This article is owned by Tech Times
Written by Sophie Webster