September 9—Nintendo raised its Switch production target to 30 million units for the current fiscal year, reports Bloomberg. Previously, the video game company only intended to make 21 million consoles by next March. However, the firm upped its hardware manufacturing quota three times in the last few months to meet demand.
Nintendo intends to keep its sales brisk through 2021 by launching an upgraded version of the Switch.
The Switch Sales Boom Almost Didn’t Happen
Although Nintendo launched the Switch in 2017, the gaming platform has experienced a significant resurgence in the post-pandemic era. However, the corporation initially struggled to take advantage of the public’s mounting interest in the console.
In February, the corporation informed its Japanese retail partners that Switch quantities would be constrained due to coronavirus related supply chain disruption. At the time, Foxconn, Nintendo’s device assembler, had temporarily suspended production in its Chinese facilities by order of the local government. As the outbreak spread worldwide, the company’s Malaysian and Philippine component vendors also shut down.
Amid that turmoil, businesses transitioned millions of people to work from home status to halt the expansion of the pandemic.
To alleviate feelings of boredom and isolation, quarantined consumers substantially increased their gaming time. Microsoft, Sony, and Valve saw increased usage of their platforms, but Switch purchases surged with the release of “Animal Crossing: New Horizons.” Players found the title’s whimsical aesthetics comforting in a time of global crisis and anxiety.
Unfortunately, Nintendo’s supply chain problems resulted in a spring hardware shortage that made Switch availability scarce worldwide. However, the corporation’s production and shipping capability recovered by summer, and its sequential operating profit increased by five times in the second quarter.
Nintendo’s 2021 Plans
Nintendo intends to follow up its chaotic but lucrative 2020 by releasing a revamped version of the Switch in 2021.
Although the company is keeping details about its new upgraded console under wraps, Bloomberg notes its new platform will feature 4K resolution and greater processing capability. The firm is also working with developers to ensure its premium system debuts alongside several appealing new titles.
Nintendo’s current strategy involves the brand largely sitting out the 2020 holiday season. The company has a few blockbuster games set for release ahead of the holiday quarter. It also does not intend to start production on its 4K platform until next year.
While unusual for an electronics firm, the brand’s roadmap makes a lot of sense.
Microsoft and Sony are planning to refresh their Xbox and PlayStation lines this winter, which will dominate gamers’ attention. By staying out of the fray, Nintendo will keep its new products from being overshadowed.
In addition, the firm’s suppliers are currently running their factories at 120 percent of capacity to make more Switches. Initiating a major shift in focus now would negatively impact the manufacturing of a highly in-demand product.
Like the tortoise of legend, Nintendo is looking to win the gaming console race by taking a slow and steady approach.