Nintendo’s business is still strong, but is The Bloom Off Switch Lite? – Talking point

Nintendo released its first quarter financial results today and they were largely as expected. The extraordinary boom in business since the equivalent period in 2020, when Animal Crossing: New Horizons took off and gamers around the world were forced to seek home entertainment above all else, was not repeated. Nintendo, along with several similar companies, has forecast lower sales and profits as 2021 is simply not recreating those same conditions, at least not to the same degree.

The results ultimately still show that Nintendo is making extremely healthy profits, and that will likely continue for the rest of the year. All this while still in the midst of difficult conditions and health concerns in much of the world, with Japan being a country (among others) with continuous restrictions that affect work practices, travel and more. This year, regardless of the platform and the size of the company, it has been characterized by project delays and extensions; games and products still take longer to finish than in previous years, and that impact is ongoing.

Going beyond (hopefully) the current pandemic-related issues, Nintendo has a great Mario movie in 2022, continued development of its theme parks, and of course several big-name games on the horizon.

The purely financial figures, even with the drops compared to 2020, are still significant: Nintendo is so rich in cash that it is going to spend up to $ 900 million buying its own shares just to ‘cancel’ them, a move that is only in the playbook during good times. Going beyond (hopefully) the current pandemic-related issues, Nintendo has a great Mario movie coming out in 2022, continued development of its theme parks, and of course several big-name games on the horizon. The numbers may be “low”, but they are certainly not “low”; the company’s bank balance, brand power, and current popularity are extremely healthy right now.

Still, you don’t have to look far to find Nintendo fans who are unhappy, or at least a little disappointed with recent trends. The introduction of the OLED Switch (and the inevitable focus specifically on what It is not) It was not well received by all, and while there are several major game titles on the way, there is always a desire for more. Arguably, the challenges of the past year have also seen missed opportunities; Animal Crossing: New Horizons is a good example. It has been a phenomenal bestseller that at one point had irrepressible momentum, however, after a positive initial period, significant updates slowed, practically stopping this year. Considering the nice features that the latest game still lacks compared to its predecessors, and the extraordinary earnings it helped generate, the recent news that updates are in development is welcome, but it also feels pretty late. It could be said that that ray has escaped from the bottle; the captive audience has moved on.

Hardware sales, while still very healthy, also show a change in trends, with the biggest loser in this case being the Switch Lite. As you can see from the graph below, it was doing particularly well in the equivalent period a year ago, but we recall that standard Switch models were hard to find at the time, making the Lite the one. only option available for periods of time.

What the graph shows is selling through (systems that sell to consumers, not wholesale figures to retailers), so it helps give an idea of ​​what has been flying off the shelves, not what that the retail industry has been buying as stock. Last year, as Nintendo grappled with supply issues for the standard model, many chose the Lite model.

To be clear and fair, it can also be said that the Switch Lite has been a hit since its arrival in 2019, the latest figures show. 15.84 million Lite system sales so far, compared to the standard Switch that has been sold 73.2 million units with 29 extra months on the market. Last year was strong for the Lite, selling just under half the standard model, which is a similar ratio to its debut year on the market. As a derivative device lacking that namesake ‘switch’ mechanic, however, it found its place on the market.

However, that graph above shows that in the first quarter of this year not even a broader demand for the Switch is raising Lite sales to the same degree it did in the depths of the 2020 locks. The standard Switch models still They are being sold ‘through’ to real consumers at a solid rate, but Lite models are starting to spend more time on the shelves. In the first quarter of last year, Lite consoles accounted for 46.1% systems sales; in the first quarter of this year, it was reduced to 25.6%.

As hardware sales drop compared to last year, it’s the Lite that seems to be missing out.

It reminds me of a recent Soapbox on these pages of Kate Gray, wondering if it’s time for a new Nintendo handheld, while acknowledging that the odds of that happening seem slim to nonexistent. The Switch is a hybrid, of course, and that’s one of the key selling points that has driven its phenomenal success. However, while the Switch can be placed in a case and carried in a bag, for example, a habit this scribe has when visiting family, it is not a useful laptop in the same sense as a DS or 3DS. It is not a system that is kept in a pocket or in a small corner of a tiny bag. It’s also not particularly durable and is designed for extended travel and tough real-world situations. It’s probably best to enjoy it in portable mode in a comfortable chair at home, or to take on the road with careful handling in mind.

And the Lite doesn’t fully address those issues because the concept of the system possibly slows it down. It has a rubberized and more durable casing, its Joy-Cons are built in (which is enough to strike fear in those of us who have drift issues), but that remains. a little too big to be a true portable system to take anywhere.

Perhaps it is also due to a price cut. Nintendo, of course, does not cut prices when something is going well, as we see with the continued demand for standard models and the price given to the next OLED model. However, if the Lite continues to fall for the next six months, it may be in the cards. After all, there are key ‘Switch’ features it loses with the Lite: detachable controllers; full compatibility with products like Labo and, more tellingly, the best-selling Ring Fit Adventure; the main feature of connecting seamlessly and instantly wherever there is a Switch dock for shared and multiplayer gaming experiences. It’s a Switch without the console’s unique selling points, but it still costs $ 200; it’s easy to see why it’s not the preferred choice for most when standard models are available.

It’s a Switch without the console’s unique selling points, but it still costs $ 200; it is easy to see why it is not the preferred option for the majority

None of this is surprising, perhaps, especially since the 2DS had a similar status in the 3DS family; useful for some as a second system, or perhaps a less expensive option for children. Perhaps what we’re really seeing is the end of the honeymoon sales period: collectors desperate for a cute Lite in a particular color or a second set for families. More importantly, that unprecedented boom of 2020, when Lite sales peaked in spring / summer, will not repeat as long as standard model supplies match or are closer to meeting consumer demand.

‘The Switch That Doesn’t’. It has had a good run and we will continue to find new happy owners, we are sure; however, it is destined to be a relative footnote in the history of the Switch family of consoles when the dust settles a few years from now. It will be interesting to see if that fate also awaits the OLED model.

What do you think of the Switch Lite? Do you think its general appeal would increase again if Nintendo lowered the price? What price should it have? Let us know in the survey and comments below.