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PS4/XBO/NS - 2018 vs. 2019 - Week 49 Numbers Added; Cyber Monday

Forums - Sales Discussion - PS4/XBO/NS - 2018 vs. 2019 - Week 49 Numbers Added; Cyber Monday

RolStoppable said:
Amnesia said:

Ok, it was a mistake to only look at the gap on Q3 2018 and not the entire 30 millions. Plus I have revised my numbers, there are more gap now between sold Q3 and ship Q3.

So Why here we have such a huge gap, but now we would pretend that for 2018, VGC's estimation would be so much better :

FY 2017 ship : 15,06

FY 2017 sales : 13,51

So what gap shall we expect now if projection of FY2018 sold gives us 17,08 (my projection), why before we had 1,55M and now it would be much less ?

You are making the same mistake again. The proper comparison is always LTD sell-through vs. LTD shipments. The key point is that retailers tend to maintain a stock level that lasts them 6-8 weeks in order to be prepared for sudden surges in demand; if they ran out of consoles, a potential customer would do their business at a different store.

A console that sells 250k units per week worldwide will have a bigger gap between LTD sell-through and LTD shipments than a console that sells only 150k units per week. There are times when retailers over- or underestimate demand for a console, so the following fiscal quarter will see a correction due to retailer orders. VGC's estimates point to a slight overestimation, so for the current fiscal quarter sell-through can exceed shipments as retailers scale down the stock they have on shelves and in their warehouses.

So...

 

I have made a graph to see the evolution of the quantity in transit, we have seen that they theoriticaly shipped at every quarters a bit more than what was counted and adjusted here, except for the Q1 2018. So the transit quantity is increasing, and lately, the sales of the Switch has been surprising, I would guess that the stock in transit should keep increasing a little bit again... OR there will be a "lag" in the reaction to adapt the stock to the sales increase and they might announce an inferior shipment than what was sold for 2018 Q4 ?

 

Woudl be interesting to make the same grapho for 3-4 other consoles and see if there is a predictable behavior to this stock quantity. Could it be a rule here that the stock takes a hit at every Q1.

Last edited by Amnesia - on 17 March 2019

Current PB on Secret of Mana remake : 2h27 (2nd)
Strongest worldwide achievement on TGM : 1st European S13 rank
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LET'S FACE THIS FACT : The Switch is the last physical video game system of the history who has a chance to beat PS2's sales.

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Amnesia said:

So...

I have made a graph to see the evolution of the quantity in transit, we have seen that they theoriticaly shipped at every quarters a bit more than what was counted and adjusted here, except for the Q1 2018. So the transit quantity is increasing, and lately, the sales of the Switch has been surprising, I would guess that the stock in transit should keep increasing a little bit again... OR there will be a "lag" in the reaction to adapt the stock to the sales increase and they might announce an inferior shipment than what was sold for 2018 Q4 ?

(numbers and graphs)

There's no definitive answer here, because VGC's numbers are estimates and adjustments can be made to older quarters over time. My main point has been that you should be a bit more cautious with your expectations, because there are factors that make a fiscal year shipment total of 18m a stretch despite strong sell-through at the moment.

In your graph you already have Switch's stock on shelves and in transit at 2.4m which is on the high side (you are actually missing Switch's launch quarter for the cumulative total of the gap between sell-through and shipments). The gap isn't going to increase with each passing quarter, because that's not how retailers work. It's more likely that the gap decreases by the end of this quarter, so if we go with your VGC projection of 3.46m sell-through for the quarter, shipments should be expected to be in the range of 3.1-3.3m rather than 3.6m.

An example that might help here is that the PS4 had a gap of 3.7m at the end of calendar year 2016, according to Sony's own sell-through and shipment announcements. The January-March quarter of 2017 then had low shipments because retailers had to correct the amount of stock they carried. That's the kind of situation that leads to the occasional quarter where sell-through is greater than shipments.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Gamers Club

RolStoppable said:
Amnesia said:

So...

I have made a graph to see the evolution of the quantity in transit, we have seen that they theoriticaly shipped at every quarters a bit more than what was counted and adjusted here, except for the Q1 2018. So the transit quantity is increasing, and lately, the sales of the Switch has been surprising, I would guess that the stock in transit should keep increasing a little bit again... OR there will be a "lag" in the reaction to adapt the stock to the sales increase and they might announce an inferior shipment than what was sold for 2018 Q4 ?

(numbers and graphs)

There's no definitive answer here, because VGC's numbers are estimates and adjustments can be made to older quarters over time. My main point has been that you should be a bit more cautious with your expectations, because there are factors that make a fiscal year shipment total of 18m a stretch despite strong sell-through at the moment.

In your graph you already have Switch's stock on shelves and in transit at 2.4m which is on the high side (you are actually missing Switch's launch quarter for the cumulative total of the gap between sell-through and shipments). The gap isn't going to increase with each passing quarter, because that's not how retailers work. It's more likely that the gap decreases by the end of this quarter, so if we go with your VGC projection of 3.46m sell-through for the quarter, shipments should be expected to be in the range of 3.1-3.3m rather than 3.6m.

An example that might help here is that the PS4 had a gap of 3.7m at the end of calendar year 2016, according to Sony's own sell-through and shipment announcements. The January-March quarter of 2017 then had low shipments because retailers had to correct the amount of stock they carried. That's the kind of situation that leads to the occasional quarter where sell-through is greater than shipments.

I would imagine that this quantity should keep increase (until a certain point ofcourse) until the console confirms that it has started the decline, which should be for FY2020 for the switch.
Also, do you have this quantity missing in my table ?

Last edited by Amnesia - on 17 March 2019

Current PB on Secret of Mana remake : 2h27 (2nd)
Strongest worldwide achievement on TGM : 1st European S13 rank
Fastest TI MASTER in Europe : rank Master V in 5min10
Current PB on Power Ranger (Game Gear) : 10min06 (World Record)

Non-geek activity : ThermalHungary

LET'S FACE THIS FACT : The Switch is the last physical video game system of the history who has a chance to beat PS2's sales.

Amnesia said:

I would imagine that this quantity should keep increase (until a certain point ofcourse) until the console confirms that it has started the decline, which should be for FY2020 for the switch.
Also, do you have this quantity missing in my table ?

Taken from here: http://www.vgchartz.com/weekly/42827/Global/

2.33m LTD by April 1st 2017.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Gamers Club

Thanks ! ofcourse...The direct quantity was there.

I still don't see well your logic. Why just now, this time, the stock would start to decrease after having increased almost all the time, and now, precisely where the sales are exploding, 2019/2018 sees a much stronger difference than 2018/2017, I mean : there are +35% of sales this week with still nothing big and new, and still no price cut, except in US (30% of the market).

But for some reasons, before the arrival of Yoshi and SMM2, retailers would decide to reduce their orders ?

 

 

For the 6th Q, it is logical : sales has slown down in FY2017 Q4, so they reduce orders and the ship is lower than the sales for FY2018 Q1.

But now, the scenario is a total opposite.



Current PB on Secret of Mana remake : 2h27 (2nd)
Strongest worldwide achievement on TGM : 1st European S13 rank
Fastest TI MASTER in Europe : rank Master V in 5min10
Current PB on Power Ranger (Game Gear) : 10min06 (World Record)

Non-geek activity : ThermalHungary

LET'S FACE THIS FACT : The Switch is the last physical video game system of the history who has a chance to beat PS2's sales.

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Week 9 Numbers have just been posted for the Week Ending March 2nd.



Pancho A. Ovies

Nintendo Switch in Japan (Famitsu): 2018 vs. 2019
http://gamrconnect.vgchartz.com/thread.php?id=238945&page=2

PlayStation 4/Xbox One/Nintendo Switch: 2018 vs. 2019
http://gamrconnect.vgchartz.com/thread.php?id=239387

Amnesia said:

Thanks ! ofcourse...The direct quantity was there.

I still don't see well your logic. Why just now, this time, the stock would start to decrease after having increased almost all the time, and now, precisely where the sales are exploding, 2019/2018 sees a much stronger difference than 2018/2017, I mean : there are +35% of sales this week with still nothing big and new, and still no price cut, except in US (30% of the market).

But for some reasons, before the arrival of Yoshi and SMM2, retailers would decide to reduce their orders ?

For the 6th Q, it is logical : sales has slown down in FY2017 Q4, so they reduce orders and the ship is lower than the sales for FY2018 Q1.

But now, the scenario is a total opposite.

Alright, one more time.

Retailers tend to maintain a stock level that lasts them 6-8 weeks outside of the holiday period. Since Nintendo counts units as shipped as soon as they leave their own warehouse, we always have the situation of units at retailers plus units in transit. That's why using 8 weeks of sales for a rough calculation makes much more sense than only 6 or 7. Multiply the weekly sales rate by 8 and you'll be in the right ballpark for an estimate of the gap between LTD sell-through and LTD shipments. Note that this doesn't work for the end of the holiday quarter due to the unusually high sales rate leading up to Christmas.

For Q6 there's a decrease in the gap because sell-through slowed down significantly in April and May 2018. When a console sells ~170k per week and you multiply that by 8, you get 1.36m. It's not an exact science because different retail chains have different ideas about how much stock they want to have in reserve. A multiplier of 8 is on the low end, so basically the minimum. Thinking about it, a multiplier of 9 might actually be closer because the transit via ship causes quite the delay. A gap of a good 1.5m at the end of Q6 makes as much sense as a gap of close to 2m at the end of Q5 (weekly sales rate of ~210k, multiplied by 9, ~1.9m).

This rough maths is not going to hold true all the time because there are times when retailers over- or underestimate demand. It's usually the following quarter that sees a correction when retailers didn't anticipate demand correctly. The most recent gap has been 2.8m, so a correction is in order when we are looking at a weekly sales rate of ~250k. That's 2.25m when multiplied by 9. I doubt that retailers expect Yoshi's Crafted World to move a significant amount of hardware. Super Mario Maker 2 releases in June, so retailer orders in anticipation for that game would be placed in April at the earliest.

It may seem weird that this quarter is going to have lower shipments than sell-through, but retailers have to clear some of their excess stock that has been left over from the holiday quarter due to overestimation of demand. One important thing to remember is that Switch's year over year increase in sell-through is still going to be reflected in shipment numbers. Last year Nintendo shipped 2.93m, this year in the same quarter it's going to be more than 3m. Another important thing is that this assumes that VGC's estimate of the gap by the end of calendar year 2018 is correct. Should that get adjusted, then the variables change.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Gamers Club

Ok. I am impatient to see if you are right. 7 more weeks and we will know.

I have understood everything you have said.



Current PB on Secret of Mana remake : 2h27 (2nd)
Strongest worldwide achievement on TGM : 1st European S13 rank
Fastest TI MASTER in Europe : rank Master V in 5min10
Current PB on Power Ranger (Game Gear) : 10min06 (World Record)

Non-geek activity : ThermalHungary

LET'S FACE THIS FACT : The Switch is the last physical video game system of the history who has a chance to beat PS2's sales.

Just updated. The Switch is now up YoY by slightly over 600k. The PS4 is about 2/3rd of the way to being down by 1 million. The Xbox One is just trucking along.



Pancho A. Ovies

Nintendo Switch in Japan (Famitsu): 2018 vs. 2019
http://gamrconnect.vgchartz.com/thread.php?id=238945&page=2

PlayStation 4/Xbox One/Nintendo Switch: 2018 vs. 2019
http://gamrconnect.vgchartz.com/thread.php?id=239387

PAOerfulone said:
Just updated. The Switch is now up YoY by slightly over 600k. The PS4 is about 2/3rd of the way to being down by 1 million. The Xbox One is just trucking along.

Would it be too much to ask to include the % up/down YoY?



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