No Switch for You
While many manufacturers complain about component shortages and transportation issues making it difficult for product to reach retail shelves before the holidays, Nintendo (7974.JP) has made a very definitive statement about its plans to reduce shipments from an expected 30m Switches in fiscal 2021 to 24m, despite strong demand in Japan, said to be at a record level. Nintendo’s President Shuntaro Furukawa stated that “It is not at all that the sales peak has passed, it is that the production volume cannot be produced in full and the production plan is unclear.”
Accordingly, the company notified its suppliers of the reduction, which is based on a lack of silicon based components that have already limited supply in Japan, where stores are resorting to lotteries to manage the lack of supply. Retail store comments have indicated that volumes received are less than half of what was expected, causing sales in September to decline by 37% y/y, following two months of y/y sales declines. As a check, we looked at the price of the 6.2” LCD Switch on Amazon (AMZN), which can be seen in Fig. 2, a good indication that it is hard to come by.
Accordingly, the company notified its suppliers of the reduction, which is based on a lack of silicon based components that have already limited supply in Japan, where stores are resorting to lotteries to manage the lack of supply. Retail store comments have indicated that volumes received are less than half of what was expected, causing sales in September to decline by 37% y/y, following two months of y/y sales declines. As a check, we looked at the price of the 6.2” LCD Switch on Amazon (AMZN), which can be seen in Fig. 2, a good indication that it is hard to come by.
Nintendo Switch Price - Amazon - Source: Camel
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