To say that Nintendo did well last year would be to put it mildly. After reaching just under 80 million Switch sales, the Japanese company revised its expected profits to $ 5.34 billion and there has been talk of responding “rigorously” to the demand for additional Switch consoles per household as Nintendo pushes sales further. However, selling multiple consoles to the same family isn’t the only way the company can keep its momentum going.
Following Nintendo’s recent financial results, an investor Q&A conference call was released this week, chaired by Nintendo President Shuntaro Furakawa. Informed that “Nintendo Switch has entered the middle of its lifecycle,” he attributed console sales to newer games like Animal Crossing: New horizons, also noting that 60% of software sales were made through Nintendo’s back catalog.
Asked about areas where Nintendo can push console sales further, Furakawa replied:
Looking at the size of the population … I think there is still a lot of room for new demand in the United States and Europe, even more than in Japan.
In addition, sales in the “Others” region, which includes Asia, are growing at an even higher rate of growth than Japan, North America and Europe. We therefore wish to further increase these sales.
However, this also comes with a recognition that there are “already a lot of people in these areas who have bought the material”, so new strategies will be needed.
During this conference call, China was also a focal point. After launching the Switch in December 2019 via Tencent, it has since sold 1 million units. On the surface, that doesn’t sound like much, but in a traditionally tough market, Nintendo is now in the lead. Speaking further on this, Furakawa says they are “not discussing sales expectations in China” Ring-shaped adventure as a big driver. An increase in sales around the Chinese New Year is expected, but “not yet on a scale that will have a significant impact on our business as a whole”. Furakawa adds that despite its success in China so far, forging a strong market share in the region is “an effort that will take time.”
Finally, regarding the console reaching the middle of its lifecycle (which suggests Nintendo expects Switch to last around eight years), Furakawa said the company is pretty confident Switch will overtake the Wii in terms of of total sales. The Wii – the company’s most popular home console – sold 101.63 million units over its lifetime.
Because Animal Crossing: New Horizons was a success, many consumers became interested in Nintendo Switch, and it was one of the main reasons for the increased sales of the system. We aim to build on this momentum and increase the cumulative sales volume to exceed that of Wii.
Do you think there are any key areas that Nintendo could still capitalize on? Let us know in the comments.