Nintendo Switch Sales Dips As Production Continues Decline Due To Chip Shortage

Nintendo has reported millions of decrease in sales in its quarterly sales.

The decline in sales for Nintendo did not just affect the Switch products, but also included products like Switch OLED and Switch Lite.

The total number of units sold for the Nintendo Switch family of products as a whole was 3.43 million, a 22.9 % decrease year on year.

During last year's fiscal year, Nintendo noted that titles from other software publishing companies have helped to drive increased sales on the Switch, especially in Japan.

Although the Japanese company noted that the ongoing shortage of the semiconductor materials needed to produce the hardware has also contributed, along with other factors, to the decline in this quarter's unit sales.

Nintendo Switch Hardware

Nintendo stated that the global shortage of chips is continuing to make it difficult for Nintendo to meet its production targets for the hardware console.

The company revealed today that this was a contributing factor in the nearly 23 % drop in console sales, which brought the total number of units sold in the three months ending June 30 to 3.43 million.

According to Nintendo's earnings release, production was hindered by a number of factors, including the widespread shortage of semiconductor components.

This, in turn, led to a reduction in the company's hardware shipments and, as a consequence, a decrease in overall sales. It was stated that it anticipates chip sourcing to gradually improve beginning in late summer and continuing into autumn.

The Verge noted that the sales of the regular Nintendo Switch were down nearly 60 % during the quarter, coming in at 1.32 million units. On the other hand, sales of the Switch Lite were also down nearly 50 %, coming in at 0.59 million.

The Switch OLED, which did not become available to consumers until October of last year, helped make up some of the shortfall by selling 1.52 million units.

Additionally, software sales were lower by 8.6 %, amounting to just under 41.5 million units sold. The company continues to anticipate that it will sell 21 million consoles during the course of its fiscal year, which will end in March 2023.

Nintendo Sales

Nintendo's hardware comes in different variations, depending on region and model. Despite these variations, the demand has become consistent across all regions, six years after it was first released.

When looking at Nintendo's mobile and IP-related businesses, royalty income stayed the same while income from smart-device content decreased year-on-year. This resulted in a 16.8 % drop in overall sales.

When it comes to the software sales of Nintendo, both the Mario Strikers: Battle League and Nintendo Switch Sports that were released this quarter have had good starts to sales. The sales of Mario Kart 8 Deluxe, which is an evergreen game title that is well-loved, have continued to show steady sales.

Furthermore, according to Nintendo, the title that grossed the highest sellthrough of any entry into the Nintendo ecosystem is the game Kirby and the Forgotten Land, which was released on March 25.

Kirby and the Forgotten Land has been a game that has been around for three decades and has positively brought in sales of 4 million units in just 15 weeks.

However, overall software sales did not keep pace with the strong showing of the first quarter of the previous fiscal year and totaled 41.41 million units, which is a decrease of 8.6 % year-on-year.