In recent months, the climate of the video game industry has been shaken up by the announcement of a number of large-scale acquisitions. However, the Nintendo Switch handheld-console hybrid has been passing one milestone after another, and according to Nintendo, the console is far from done. The company has stated that the Nintendo Switch is still in the middle of its lifecycle, which has some significant implications for the approach Nintendo is taking to the changing industry.
A massive shortage of chips, semiconductors, and other console materials during the pandemic has led to Sony producing more PS4s to make up for the lack of PS5s. Nintendo has also been affected, but the company has apparently chosen to cut Switch sales outlook again for this quarter.
The company now expects to sell a total of 23 million Switch units in the fiscal year ending in March, which will be a step down from the previous 24 million. Nintendo has reportedly sold 18.95 million consoles over the last nine months, a number that, while impressive, is a 21% drop from the same period in the previous year. Despite this, unit sales of the Nintendo Switch have surpassed the Nintendo Wii, a fact that pushes the Switch into the list of top five best-selling video game consoles. President Shuntaro Furukawa has confirmed that the Switch is still in the middle of its lifecycle before stating that the momentum going into this year is good.
The OLED model of the Switch has been quite hard to find in stores, which suggests that Nintendo's sales could have been higher if the supply was larger. It appears that many video game companies are having difficulty getting their consoles onto retail shelves. However, strong software sales during the holidays and a fast-selling new Pokemon game have still led to Furukawa raising Nintendo's operating profit outlook for the fiscal year from 520 billion yen ($4.5 billion) to 560 billion yen ($4.9 billion).
Unfortunately, it doesn't look as though Nintendo will be finding a way out of the component shortages that have caused so much trouble throughout the industry by the end of the year. However, President Furukawa states that he is confident in the Switch's ability to break the pattern of Nintendo consoles losing steam in their sixth year on the market. Between the fresh success of Pokemon Legends: Arceus and two new potential blockbuster titles in The Legend of Zelda: Breath of the Wild 2 and Splatoon 3, the Nintendo Switch could still have plenty of room for growth.
Source: Bloomberg
