Nintendo is reportedly cutting Switch 2 production this quarter as US demand dips
It plans to make 4 million units instead of 6 million, it’s claimed
Nintendo is cutting Switch 2 production this quarter as a response to lower than expected demand in the US, a new report claims.
According to sources speaking to Bloomberg, the company plans to produce 4 million Switch 2 consoles during this quarter, instead of the 6 million it had originally planned to produce.
The publication’s source also claimed this reduced output rate is set to continue into April.
While Switch 2 remains extremely popular in its native Japan, this was the only market that experienced severe stock shortages. In the US, following a record-breaking launch, Switch 2 sales slowed over Christmas and ended up down by around 35% compared to what the original Switch managed during its first Christmas period in 2017.
Bloomberg’s sources say that the critical and commercial success of Pokémon Pokopia hasn’t yet caused Nintendo to start increasing Switch 2 output yet, with the company instead waiting to see if it and other titles continue to have sales that are consistent enough to justify an increase in console production.
Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors, told the publication: “This hardware shortfall in its first year, during its big holiday season, is awful news. Clearly the software line-up has been poor, at least until most recently, with Pokémon showing some hope.”
The publication’s sources also claim that the decision to slow down production is driven by slower demand, rather than the ongoing concern over increased RAM and storage costs.
Nintendo president Shuntaro Furukawa said last month that Nintendo was having discussions with its suppliers to ensure a stable supply in the long term, and that as a result there were no plans to increase the price of Switch 2 due to the increasing cost of memory, at least at this time.
Compared to Switch 1’s first Christmas, sales of Switch 2 were up in Japan (1.77m vs. 2.43m), but slightly lower in the US (2.82m vs. 2.3m) and the rest of the world (2.64m vs. 2.27m).
Despite this, Switch 2’s phenomenal sales pace has ensured it continues to enjoy the fastest-selling console launch ever, selling 17.37 million units in its first 7 months on sale.
Nintendo expected Switch 2 to sell-in 19 million units by the end of its current fiscal year, which runs until April 1, and it’s still highly likely it will surpass this number. The original Switch took two years to clear 20 million annual sales in a single fiscal year, and three to clear 21 million.
