Big news out of the video game industry today as Japanese system manufacturer Nintendo announced they are cutting its full year Switch sales by 6% as they struggle to meet demand for the coming holiday season with the ongoing chip shortage continuing to hold up production.
This is just the latest company to announce delays in the year’s fourth quarter as this chip shortage continues to leave many shelves empty and eager customers empty handed.
Join us today as we dive into this latest update in the video game industry and how company officials are combating this latest obstacle.
Nintendo’s Latest Hurdle…
Nintendo, one of the leaders in video game console production, announced Thursday that they are cutting full year Switch sales by 6% for the coming holiday season. This decision, a major blow for Nintendo, is largely due to a delay in production as chip manufacturers continue to struggle to meet demand in this and many other sectors.
The Nintendo Switch, the company’s currently produced video game system has now been in production for 5 years and, as a result, has seen a decline in sales by a third to 8.28 million units when compared to last year’s data.
And though newer and updated models continue to arrive to an eager market, chip shortages hinder full production to meet demand.
This is not great news for Nintendo officials who have already seen their shares close down 1.7% ahead of earnings and lose 25% this year alone.
Speaking during a recent news briefing, Nintendo President Shuntaro Furukawa said the company, “… can’t produce enough to meet the demand we are expecting during the upcoming holiday season. Currently there is no sign of improvement and the situation continues to be severe so I can’t say how long it will continue.”
With the company up against major players in the industry such as Sony and their Playstation consoles and Microsoft with their XBOX consoles – the latter of the two having just recently surpassing Apple to become the world’s most valuable company – Nintendo continues to rely heavily on the brands they currently have under their umbrella including Pokemon, Mario Brothers, Zelda and more.
With the popularity of these and other licensable brands within their control, the company will more than likely have to lean more heavily on revenues attributed to sales from these copyrighted materials while continuing to struggle to get consoles back on the shelves in the weeks and months to come.
Learn More Here…
If you’d like to learn more about today’s markets and the steps you could take to combat their most recent volatility, then we invite you to sit down with DTI founder and 40-year market veteran Tom Busby now as he dives into these and many more topics for his latest session of Wednesday on the Web!
P.S. – Want to know one of the best ways to play the stock market this holiday season?
Former hedge fund manager Jack Carter has put together a short video explaining why this next three month period could be the most significant of the decade.