Nintendo Expects a Decline in Switch Sales Due to Chip Shortages

Nintendo is expecting an estimated loss in hardware sales in the financial year 2021, the company sees the global chip shortages as a main setback for the Nintendo Switch production.

Nintendo forecasts a 12 percent drop in sales of Nintendo Switch consoles in the financial year ending in March 2022, the Japanese tech giant expects to sell 25.5 million units.

Analysts affirm that the global chip shortage will cause delays for console manufacturers, here is what Nintendo told investors about the situation.

Production “might be affected by obstacles to the procurement of parts, including the increase in global demand for semiconductor components,” Nintendo said in its financial statement.

Nintendo is reportedly planning to release the Nintendo Switch Pro, or Nintendo Switch 2 in late 2021, the console will be sold at MSRP of $399 USD.

Bloomberg Intelligence’s Matthew Kanterman affirms: “$349.99 will increase the value proposition of the device, but I still think Nintendo can drive strong demand even at $399.99”.

The new Nintendo handheld console will be upgraded with an NVIDIA chip featuring better graphics, a larger OLED screen, and a larger battery.

The new version of the Nintendo Switch will support NVIDIA’s Deep Learning Super Sampling, a new rendering technology that uses AI to boost the graphics of the console in an efficient way. The technique will allow Nintendo to take the best from Samsung’s OLED display and run games upscaled to 4K on docked mode. Samsung’s OLED panel will also boost battery efficiency affirms insiders.

2020 was one of the best years of Nintendo following the launch of Animal Crossing: New Horizons, Mario Kart Live: Home Circuit, and increased demand in The Legend of Zelda: Breath of the Wild.

Nintendo Switch software sales are expected to fall 18 percent to 190 million units.

Source: Financial Times

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