Analysts Challenges Assertion Switch Is Not Selling Well; Selling Faster Than PS4

Oct 25, 2017
23,590
#1
Ace Research Institute analyst Hideki Yasuda, who is well known in Japan for his analysis and predictions on the gaming market, doesn’t agree with the perception that the Switch isn’t selling well, as he mentioned in his report published today.
Yasuda-san explains that with 14.49 million units shipped in the first three quarters of the fiscal year and 32.28 million units shipped in the console’s lifetime, the dropped annual forecast is causing people to misunderstand that the Switch isn’t selling well.

In reality, according to Yasuda-san, it’s selling at a quite high pace. Compared to the PS4, which is the most successful recent example, shipments at the eighth quarter of each console’s lifetime are higher by three million in favor of the Switch.


SOURCE

I think the key takeaway for Nintendo for this should be to not be so ambitious with their forecasts. A missed one like this can sour the narrative for them even when they are doing well, as the Switch so clearly is.
 

BGBW

Member
Oct 25, 2017
5,746
#2
Isn't Nintendo notorious for being ambitious with their forecasts? This just seems to be the first case where people have really paid attention to it.
 
OP
OP
Phantom Thief
Oct 25, 2017
23,590
#3
Isn't Nintendo notorious for being ambitious with their forecasts? This just seems to be the first case where people have really paid attention to it.
No, they’re usually way too conservative with their forecasts, which is why this one stood out.
 
Nov 2, 2017
2,636
Norway
#4
I don't think anyone that are interested in the sector thinks they are selling badly. It's just that most investors look at the missed forecast. Usually the price of a stock has the forecast "baked in", that is the price is already set for that level of sales and when it misses it the price drops to what it would have been with the actual shipments.
 
Oct 25, 2017
14,190
#5
This thread is bound to go well.

Anyway, yes, investors being short sighted is not really news but I don't think they're panicking solely because of the lowered hardware forecast. Nintendo also has not given any real specificity with their direction going forward into 2019 and on, which is not a great look after lowering those projections.

And yes the launch date discrepancy will always mess with the PS4 comparison, no need to argue about it for 5 pages.
 
Oct 25, 2017
614
#6
I’m curious as to why they even put out the 20m forecast to begin with. Even if you think you can do 20m, forecast 18m and overdeliver. Forecasting a number you know will be difficult to hit just to show confidence doesn’t make long term business sense.
 
Oct 25, 2017
6,422
#7
Would be kind of foolish to think switch isn’t selling “well” after the data we received.
Imagine one can still argue that it’s not selling as well as it could.

Do wonder if they would’ve reached their target if nothing got delayed
 
Nov 2, 2017
2,636
Norway
#8
I’m curious as to why they even put out the 20m forecast to begin with. Even if you think you can do 20m, forecast 18m and overdeliver. Forecasting a number you know will be difficult to hit just to show confidence doesn’t make long term business sense.
Especially not in the fucked up quarterly news cycle that everyone seems to be bound to now a days where "long term" means next year.
 
Oct 27, 2017
2,190
#14
This was bound to happen if they didn’t reach their ambitious 20m Target, and was definitely going to happen when they went conservative with the revised target. No reason it shouldn’t get to 18m in my opinion.

All of this has also occurred without a price drop and few bundles in the West. Nintendo is in an excellent position regardless of what their current stock is doing (similar can be said for Sony).
 
Oct 27, 2017
4,096
London
#15
doesn’t agree with the perception that the Switch isn’t selling well
Unless there's additional info in the article, I haven't seen any one suggest this.

Edit: just read the article, perception is in relation to investors, not the consumer/general public.

I'll leave this here for anyone confused.
 
Jan 28, 2019
6
#17
Who thinks the Switch is not selling well? The investors feeling about the console is not always aligned with the sales figures. Switch is killing it. Even Sony shares dropped, although PS4 was the best selling console of the year and Sony hasn't changed their target for this FY. Stock market is weird, really weird.
 
Oct 27, 2017
4,413
#18
No, they’re usually way too conservative with their forecasts, which is why this one stood out.
They weren't conservative at all after the Wii. They had to revise Wii U sales projections multiple times in years 1 and 2 of the Wii U. They moved them down, and then still failed to meet the new numbers.
 
Oct 27, 2017
2,190
#22
Unless there's additional info in the article, I have seen any one suggest this.
Here is a comment from some Analysts that I think this article addresses:

Analyst said:
“All great consoles need a great second year, and Nintendo hasn’t delivered one for the Switch,” said Cornelio Ash, an analyst at William O’Neil & Co. in Los Angeles. “Investors thought over five years they could sell maybe 90 million units. But after this year, that’s looking pretty much impossible.”
“Pachter said:
“I don’t see sales growing unless the price is reduced to below $200,” Pachter said, indicating a 33 percent cut from the Switch’s current price.
“Ash said:
“The Switch excitement has rapidly declined, ” Ash said. “Unless there’s significant change or something else new, the Switch story has been exhausted.”
 
Last edited:
Oct 25, 2017
14,190
#23
I’m curious as to why they even put out the 20m forecast to begin with. Even if you think you can do 20m, forecast 18m and overdeliver. Forecasting a number you know will be difficult to hit just to show confidence doesn’t make long term business sense.
There was an article (from Digitimes maybe?) last year stating they planned to manufacture 24-25M units for the FY. So maybe they were just way too overconfident and thought 20M was lowballing it.

The FE and Yoshi delays certainly didn't help but I can't imagine it would've done much more than 20M (if that) if those titles did make it into the FY.

Here is a comment from Pachter that I think this article addresses:
That's not from Pachter, it says in the quote which analyst said this.

But yeah, a few analysts (and journalists like Yuji Nakamura) have been saying it's been selling poorly, or "the Switch story is over", dumb things like that. There's really no general perception that it's not selling well though.
 
Oct 31, 2017
5,902
Greece
#24
Well yeah. PS4 only started to do really well after holiday 2015, and the Switch is much more in line with the Wii. Analysts, stock brokers, and forum armchair analysts need to chill the fuck out and look at the bigger picture. If the revision this year does what it should do like previous handheld revisions alongside the excellent software lineup, we should be looking at a number somewhere between 55-62mil for the total LTD by the start of FY20.
 
Oct 28, 2017
191
#25
Nintendo didn’t sell as many Switches as they expected during the first two quarters (April-September). Extremely robust holiday sales didn’t quite fill in that gap. Hence the lowered forecast. It’s not rocket science.
 
Oct 27, 2017
5,731
#26
This thread is bound to go well.

Anyway, yes, investors being short sighted is not really news but I don't think they're panicking solely because of the lowered hardware forecast. Nintendo also has not given any real specificity with their direction going forward into 2019 and on, which is not a great look after lowering those projections.

And yes the launch date discrepancy will always mess with the PS4 comparison, no need to argue about it for 5 pages.
I think the investors are reacting fine. Nintendo stock is up today and the huge one day drop happened for exactly one day. At $36 and change into the OTC markets it's still higher than their average price last fall when people first speculated they may missAnd has recovered most of the losses from last week


I would venture to guess investors still see Switch as on an upward slope and picked up bargain shares last week.
 
Dec 21, 2017
4,929
#30
He's right, the numbers are right. Switch is selling faster than PS4.

Investors are the ones to blame (and Nintendo for throwing such an unrealistic goal) for always being way too pessimistic.

The Switch sold less in 2018 than the PS4 but will surely win out in 2019, no surprises there.
Fiscal year ends in March 31st.
 
Oct 27, 2017
2,190
#31
There was an article (from Digitimes maybe?) last year stating they planned to manufacture 24-25M units for the FY. So maybe they were just way too overconfident and thought 20M was lowballing it.

The FE and Yoshi delays certainly didn't help but I can't imagine it would've done much more than 20M (if that) if those titles did make it into the FY.



That's not from Pachter, it says in the quote which analyst said this.

But yeah, a few analysts (and journalists like Yuji Nakamura) have been saying it's been selling poorly, or "the Switch story is over", dumb things like that. There's really no general perception that it's not selling well though.
Updated my post. The article I was reading had several analysts making similarly silly comments and grabbed othe wrong one. Thanks for pointing it out.
 
Oct 25, 2017
589
Canada
#32
There's no perception that it is not selling well. There's rather a perception that it is not selling well enough to satiate investors' highly optimistic desire of a primarily mobile Nintendo.
 
Jan 10, 2018
2,255
Tokyo
#34
You cannot say in good faith that the switch is selling bad. But you can absolutely say that it could have sold much* better with a stronger lineup; which is what Nintendo hoped. So in that sense, there are reasons to be disappointed, especially from a player perspective as the lofty 20m target lead most of us to expect more and better games in 2018.

*15% is much in that context.
 
Oct 28, 2017
1,246
#35
I’m curious as to why they even put out the 20m forecast to begin with. Even if you think you can do 20m, forecast 18m and overdeliver. Forecasting a number you know will be difficult to hit just to show confidence doesn’t make long term business sense.
Maybe they needed an influx of capital at the time they initially forecast?
 
Oct 28, 2017
2,558
#36
PS 4 will be ahead next quarter due to the different launch time frame.

Switch is selling well but Nintendo and investors expected more. Moreover Nintendo has still not shared important info about how they will drive growth for the next FY. No need to panic here.
 
Oct 31, 2017
546
#38
I'm confused as to why people are comparing a 3 quarter year for Nintendo, to a full years worth for Sony? Doesn't Nintendo's FY end in March? Wouldn't it make more sense to wait till March to compare to Sony's 2018's numbers?
 
Oct 25, 2017
1,338
#39
This narrative that the switch isn’t selling well is practically made up. One dude might have said something negative. That doesn’t mean everyone thinks that. People think it’s not selling as well as they thought it was going to which is a big fucking difference. Even this analyst lowered his evaluation of Nintendo.
 
Oct 25, 2017
14,190
#40
I think the investors are reacting fine. Nintendo stock is up today and the huge one day drop happened for exactly one day. At $36 and change into the OTC markets it's still higher than their average price last fall when people first speculated they may missAnd has recovered most of the losses from last week


I would venture to guess investors still see Switch as on an upward slope and picked up bargain shares last week.
Yeah I meant specifically they were short sighted in the large drops that happened last week, which were rather predictable anyway.

But investors are generally short sighted, that's not really a knock on them. That's one of the easiest ways to make money playing the stock market.
 
Dec 5, 2017
1,974
#41
Well, I don't know. Switch couldn't even defeat PS4 in sales, a console that's on the out.

Especially in Europe, Switch could do much betterr.

Hope the Switch "lite" and the next pokemon will boost sales.
 
Oct 25, 2017
14,190
#42
This narrative that the switch isn’t selling well is practically made up. One dude might have said something negative. That doesn’t mean everyone thinks that. People think it’s not selling as well as they thought it was going to which is a big fucking difference. Even this analyst lowered his evaluation of Nintendo.
I wouldn't say it's only one analyst. I saw quite a few articles last week talking about sales slowing causing investors to be unhappy.

I guess "sales slowing" and "not selling well" aren't quite the same thing, but even so "sales slowing" isn't true either.
 
Oct 28, 2017
917
#43
That was more on the Wii U than Nintendo


I believe that has to do with the state of things in the stock market currently.
But it's still their forecast. They would also cut 3DS forecast too.

Edit: Isn't this thread a repackaging of the "switch outpacing the ps4/wii launch aligned" thread?
 
Oct 25, 2017
14,760
#44
Kinda seems like we’re desperately looking for anyone who doesn’t think Nintendo are gods so that we can show them up and have an invisible person to tell “told ya so”

There’s no way anyone thinks Switch is selling poorly. Stock values always drop at the slightest hint of misgiving, that isn’t really an indication of success, yes or no, but of success, how much and with what trajectory.
 

Spyder_Monkey

Banned
Member
Oct 25, 2017
7,129
#45
Anyone can look at the numbers and say "No shit it's selling well." The entire situation was basically troll bait from the start.
 
Oct 27, 2017
2,190
#50
Well, I don't know. Switch couldn't even defeat PS4 in sales, a console that's on the out.

Especially in Europe, Switch could do much betterr.

Hope the Switch "lite" and the next pokemon will boost sales.
It’s outselling it launched aligned, though they are going to go back and forth due to when they launched.

Sure they could do better in Europe, but PS4 could do better in Japan, is that really and indictment for either console when they are on the paces they are?