The Nintendo Switch stock situation may affect the overall outlook in April
The Nintendo Switch continues to be one of gaming's most sought-after consoles, although it appears that the Japanese games giant has been a little too cautious when it came to production levels.
And it's fair to see why, the Wii U failed to make the impact that was hoped for, leaving Nintendo having to support a gaming machine with very limited third-party support.
The same cannot be said for the Nintendo Switch, with new projects and a heap of indie titles already in place for launch in the next 12 months.
However, some analysts are worried that even though the Nintendo Switch might be about to top the Wii U AND Wii in terms of first year impact, the company’s conservative production target may mean a disappointing April investors outlook.
Jefferies Group analyst Atul Goyal has told Bloomberg that it’s estimated that 2.5 to 3 million Switch units were sold in March.
That would mean the Japanese games giant were way ahead of their target of 2 million, however, things could still see a downturn April 27 when sales forecasts for the fiscal year through March 2018 are announced.
“Nintendo’s guidance of Switch volumes and OP (operating profit) numbers could very well underwhelm the market,” Goyal wrote in a report to clients this week, as sourced by Bloomberg.
While the Nintendo Switch stock situation could lead to some initial disappointment, there is still evidence to suggest that the new console might still outperform the Wii.
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“Since the Switch went on sale on March 3, the Kyoto-based game maker outperformed the broader Japanese stock market by 20 percentage points through Thursday,” Bloomberg reports.
“That’s more than double the 8.9 percentage point outperformance during an equal time period that followed the Wii launch in 2006.
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“It’s also far ahead of the nearly 30 point lag shares suffered in 2012 after the disastrous launch of the Wii U, which went on to become Nintendo’s s worst-selling home console in history.”
The new Nintendo Switch console was released in March 2017 and has so far proved a hot new gaming item for many fans.
However, Nintendo Switch stock has been something in short supply for many fans looking to buy one of the new hybrid consoles.
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Leading retailers in the UK and North America have seen boosts to both their physical and online stores, however it doesn't appear to have been enough to keep up with demand in recent weeks.
New restock and availability options have been provided by the Japanese games giant, who has appeared cautious when it comes to the supply and demand of their newest product.
And a recent news update may have provided some answers to why Nintendo haven’t looked to flood retailers with mass amounts of Nintendo Switch stock.
According to a report posted in Nikkei Technology, Nintendo Switch’s currently have a high production cost.
Fomalhaut, a company that specialises in tech teardowns, has estimated that the dollar cost for many a Nintendo Switch currently sits at around $257.
This would go along way to explaining why the Switch price was set at a level that surprised analysts during its initial reveal, arriving as a $300 device.
Nintendo confirmed that they would not be selling their new console at a loss, but it also appears that they are not going to be swimming in profits from unit sales.