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Mbolibombo on 05 January 2019
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RolStoppable said:

Mbolibombo said:

Which is the quarter in question -  Q3 - holiday season, manufacturing is the only thing stoping Nintendo from not shipping intended consoles in Q3. And as I said Nintendo didnt lower their forecast before Q3 since they believed in their forecast, they have talks with retailers all year about their expectations, they're not going in blind with their own forecast. Clearly both Nintendo and retailers, had faith in what could be sold during the holidays and after which we see now is indeed happening.

As for the second bolded part, clearly you want to be prepared.  Dont want to be left hanging in the most important shopping period all year, if it piles you calibrate next quarter however it fits, there were 2 big games in January and February that year for Sony that they clearly were expecting to sell hardware and late shipments in Q3 clearly were intended for. Nintendo has a big game releasing early January that will likely push some hardware which will also need to be shipped in Q3. 

Nintendo sticking to their forecast does not give any indication for retailer expectations, so you can't take it for granted that retailers have agreed to buy that many units from Nintendo. Five years ago Nintendo stuck with their 9m forecast for Wii U before the holiday season, so that's a good example that there's no link between Nintendo forecasts and retailer expectations/agreements; said forecast had to be lowered to 2.8m during the following financial report, so Nintendo's belief from three months earlier was not even remotely in the realms of possibility. Nintendo won't be that far off with Switch, but them sticking with their forecast doesn't provide any sort of guarantee other than they have no manufacturing problems. Nintendo still needs retailers to buy those units though.

In the case of the PS4, Q4 has been repeatedly weak because the preceding holiday quarter had retailers overestimate demand for the PS4. Remember, ultimately it's the retailers that dictate the size of shipments.

The Wii U situation is not at all the same is the current one though so comparing it doesnt really make much sense. Nintendo had already cut the forecast the previous in the Wii U lifespan at that point and with a much lesser software lineup to boot so there's also difference from this time around. Heck Nintendo even had to buy back some of their stock I believe. Much better to look at other succesful platforms like the Wii and DS. Sticking to a forecast is never a guarantee of anything, just that they still believe it's possible. And clearly, retailers holds Nintendo stricter this time around after rough times with the Wii U and hard times to start the life of the 3DS. 

But yes, ultimately it's the retailers that dictate the shipments. But that's never been a question. I dont really think we're in a big disagreement here really, just different approaches.