It will be interesting what happens with hardware supply for Labo launch, Golden Week, May and June.
There is considerably more titles compared to last year and I expect larger hardware availability. In terms of hardware sales Labo launch, Golden Week and Mario Tennis Aces will be the weeks where we would get the largest supply of Switches. I think we will also see a few titles from 2018 get a boost during Labo launch/Golden Week/Mario Tennis Aces launches. Overall large Switch hardware availability in May should help leggy titles considering there is only DKTF and Dark Souls launching the entire month.
Just for comparison these are the Switch hardware sales for April, May, June 2017:
Week 14: 41.193
Week 15: 45.673
Week 16: 47.911
Week 17: 24.712
Week 18(MK8D launch): 76.679
Week 19: 24.712
Week 20: 26.114
Week 21: 27.146
Week 22: 23.524
Week 23: 27.291
Week 24(Arms launch): 37.709
Week 25: 22.361
Week 26: 25.805
TOTAL: 450.830
There was 450K sales during Q2/2017 which is an average of 34K per week.
This year the baseline has so far not strayed from 40-50K despite a very slow period in terms of software releases during January and February. Right now the average is 51K per week for the Switch in 2018.
Week 16 will mark the release of Labo and I can see hardware availability rising slightly to around >60K for the Labo launch. Week 17 is looking like a week we will see a major update for Splatoon 2 and Labo's second week, as well as a bunch of smaller games launch, I can see it also maintaining higher supply of >60K. Golden Week follows and DKTF is released which I think will lead to an even bigger week for the Switch of >70K before things slow down for the rest of May/June and for the baseline to drop back down to 40-50K. Week 25 will mark the release of Mario Tennis Aces and I expect that to also lead to larger hardware availability. If this all comes to fruition sales will surpass 650K by the end of June. So before the summer holiday we'd be looking at a userbase of >4.6M. This would mean that for the first half of the year the average amount of Switches sold would be around 49K per week.
For the second half of the year Nintendo would need to sell only >3.3M to surpass 4.5M for 2018. That requires an average of >126K per week, last year they sold >2.2M which required an average of 87K per week for the second half of the year.
I wouldn't be surprised if they sell >1.15M in July/August/September Obon + September Smash launch with an average of 88K per week. Splatoon 2 DLC, Inazuma, Taiko, Octopath are all major titles that will be helped by Obon and topping off the quarter with the launch of Smash and the new paid online service. This would make Q3 nearly as big as Q1/Q2 combined in terms of hardware sales. In Q3/2017 Switch sold 745K with an average of 57K sales, During the prior two quarters they sold 1M which obviously includes the launch and only 15 weeks the average for the first two quarters was actually 69K.
For Switch to reach >2.2M during the last quarter of the year, it would require a average of 161K per week. Last year the Switch sold >1.6M during the last quarter with an average of 124K per week. By the time the fall rolls around 3DS will be a non-factor and all sales will concentrate on the single system. Last year 3DS sold 450K during the last quarter and had two big games launch during that time - Pokemon US/UM and YWB2. This year those sales would decline and I can see 3DS barely sell 200K.
With Pokemon, Yo-Kai, Fire Emblem and DQB2 all potentially launching in the fall, I can see the Switch surpassing this total. Obviously surpassing 2.2M would make it the biggest quarter they've had for a single system since the DS days in Japan - 3DS's best quarter was Q4/2012 when it also sold >2.2M. I think it's possible for the Switch to sell 2.4M in Japan during the fall since I expect Q4 Switch sales to represent around >40% of total sales for 2018. This would require a massive average of 184K per week, which is entirely possible and would represent a 48% increase YoY in terms of Switch sales but just 16% increase compared to the combined 3DS and Switch sales in Q4/2017. As I said previously Switch's success in consolidating the dedicated video-game market will effect other consoles. 3DS and PSV already declined sharply since Switch released but I can see it also leading to a more pronounced decline for the PS4 as well. In 2017 PS4 managed 480K during Q3 and 500K sales during the last quarter of the year, this year I expect that the PS4 will see a decline both quarters. There is no DQXI and Switch stock and game launches will be plentiful. Last year PS4 was selling 20-30K during the summer, this summer I honestly don't see it selling more than 20K. Overall I won't be surprised if the PS4 finishes this year with 1.5M-1.6M sales.
In terms of World Wide Shipments I expect Nintendo to ship 19-20M units this year, and majority of the shipments to come during the second half of the year. I expect Japan to maintain 25% of supply for all quarters except the 3rd quarter since summer vacation is far more important in Japan than anywhere else in the World. Japan sell through will end up close to the shipped number.
Q1 WW Shipment: 700K Japan / 2.1M RotW / 2.8M Total
Q2 WW Shipment: 700K Japan / 2.1M RotW / 2.8M Total
Q3 WW Shipment: 1.25M Japan / 2.9M RotW/ 4.15M Total
Q4 WW Shipment: 2.5M Japan / 7.5M RotW / 10M Total
Last year the Switch sold 7.63M for the first 3 quarters and ended the year at 14.86M so the first 3 quarters of 2018 would see an overall increase of 28% in terms of sales while Q4 would need a 38% increase in terms of sales.
At E3 I do expect to see a bunch of announcements for Western 3rd party games that will be launched in the fall after Smash.