IHS Markit data shows that Nintendo Switch sold through almost 2.3 million consoles to consumers around the World during the launch month of March. This performance with limited inventory has led us to upgrade our Switch country level forecasts. New forecasts are now available in the Games Intelligence Service and will be shortly available in Games Intelligence Premium.
Prior to the launch, Nintendo had forecast that it would sell-in to retail 2 million Switch consoles during calendar Q1 2017 and the sell-through data shows that it has significantly beaten this target by a minimum of 20%. Sell-in to the end of March is likely to have amounted to between 2.4 to 2.6 million as Switch continues to be out of stock across major sales territories.
Switch Inventory Weighted Towards USA and Japan
Across the key sales regions of USA, Japan and PAL (including Europe), it is now clear that Europe has had significantly less stock to sell compared to the USA, with Nintendo prioritising the North American sales region for the launch. Japan, comparatively, has also had a lot more stock for its relatively smaller population.
According to retail sales tracker NPD, Switch sold at least 906,000 units to consumers in USA, but it is likely that the installed base of the console is at least a little higher than this due to increased imports during the opening weeks of launch when consumers were desperate to get their hands on the new console. This also goes someway to explaining why the attach rate of the Switch version of The Legend of Zelda: Breath of the Wild was higher in the USA than tracked hardware sales. In turn it is likely that a small percentage of USA tracked sales have made their way into South and Central America.
Signs Are Good but It’s Still Early
Overall, with Switch sell-through of 2.3 million, Nintendo will be pleased with the result. It will similarly be pleased with the continued sales in April even if the lack of inventory is curtailing sales to a certain degree. However, comparing the performance with previous console launches is fraught with difficulties considering the amount of variables including launch day, launch month, price point, stock management and product availability. These variables make any comparisons less insightful or useful. Even so, there is certainly stronger momentum behind the platform than we initially expected which has resulted in an upgrade to our forecasts.
Towards the end of April we are already in to the second phase of the launch cycle with the release of Nintendo’s next big Switch title Mario Kart 8 Deluxe and sales during this period will give us a better indication of how the console will retain its sales momentum. The games launch line-up for Switch for the rest of 2017 has improved and now looks quite strong.
An additional area of developing interest is when and how Nintendo will implement its paid for online console service. Using a similar conversion rate and pricing to the other online platforms – Xbox Live Gold and PlayStation Plus – Nintendo Switch subscriptions could generate spending of almost $40m in 2017 and eventually balloon to $1.1 billion by 2021. The scale of the revenue stream on offer for these services suggests a brighter future for Nintendo’s online services for Switch users.
from GoNintendo
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