Is Nintendo Switch Headed For The Same Fate As Wii U?

Japanese multinational video game company Nintendo NTDOY expects sales of its flagship Switch console to slow down this fiscal year, raising questions about whether the device is heading toward the same fate as its underwhelming predecessor Wii U. 

What Happened: Nintendo’s forecast of selling 15 million units of its Switch console, with a projected operating income of $3.3 billion (¥ 450 billion) for this fiscal year, highlights a slowdown for its six-year-old product, reported Bloomberg. 

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“We try to not only put one system in every home, but several in every home, or even one for every person,” Nintendo said on Tuesday while reporting its earnings. 

“Sustaining the Switch’s sales momentum will be difficult in its seventh year,” Shuntaro Furukawa, president of Nintendo, stated. “Our goal of selling 15 million units this fiscal year is a bit of a stretch. But we will do our best to bolster demand going into the holiday season so that we can achieve the goal.”

Despite the much-anticipated release of a sequel to “The Legend of Zelda: Breath of the Wild” and the opening of “The Super Mario Bros.” movie in April, Nintendo is unlikely to see a significant boost in hardware sales as it faces increased competition from Sony Group Corp’s SONY PlayStation 5, which plans to sell over 25 million units this year. 

According to analysts, Nintendo is unlikely to replicate its past success in boosting sales of the Switch console with hit games. Additionally, the company doesn’t have a plan to launch a successor console for another year, the report noted. 

Why It’s Important: The sales of Nintendo’s hybrid Switch console are declining faster than the company had initially expected. Moreover, there are currently no plans for a follow-up device.

Over the past three fiscal years, Nintendo sold 28.8 million, 23 million and 17.9 million Switch consoles. 

For the unversed, Nintendo Switch was an immediate hit when it launched in 2017. In its first month on the market, the company sold more than 2.74 million Switch consoles. 

Nintendo sold nearly five million Switch units in the first 10 months in the U.S. and more than 10 million worldwide. In contrast, its predecessor, Wii U’s sales, amounted to less than two million units.

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