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Forums - Nintendo - Switch costs ~$257 to build and 30MM sold through 2018

Pemalite on 05 April 2017
Miguel_Zorro said:
cycycychris said:

There not making $43 if this build price is true. Retails don't sell Nintendo hardware for free. they take at least $30-40 in my opinion. there still shipping and advertising. Nintendo say there making a profit, but its not much.

Retailers don't make money on consoles.  Seriously.

My wife works in the industry.  The ones with the most buying power break even at best.  They make a tiny margin on games, and more on things like controllers and other accesories.

Depends. Retailers like EB Games here in Australi make a large chunk of cash on refurbished/2nd hand consoles.

Normchacho said:

Margin and value aren't directly linked.

A cup of coffee that costs $.40 to make can easily be worth a few dollars, but the PS3 which cost like $800 to make wasn't worth the $600 they were asking for it.

However, an item can be considered too expensive if the things it's made of are considered much cheaper than the end product. Which is the case of the Switch Dock.

Shhh. Don't confuse people with logic. :P
But you are right though.

And for the perceived value of the Switch, it's still overpriced in my eyes. It's more expensive than the other consoles which arguably provide higher degrees of  fidelity and have a larger library of multiplats that I desire to play.




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Miyamotoo on 05 April 2017

Dont get any hope for this year price cut.



Kai_Mao on 05 April 2017
Pemalite said:
Miguel_Zorro said:

Retailers don't make money on consoles.  Seriously.

My wife works in the industry.  The ones with the most buying power break even at best.  They make a tiny margin on games, and more on things like controllers and other accesories.

Depends. Retailers like EB Games here in Australi make a large chunk of cash on refurbished/2nd hand consoles.

Normchacho said:

Margin and value aren't directly linked.

A cup of coffee that costs $.40 to make can easily be worth a few dollars, but the PS3 which cost like $800 to make wasn't worth the $600 they were asking for it.

However, an item can be considered too expensive if the things it's made of are considered much cheaper than the end product. Which is the case of the Switch Dock.

Shhh. Don't confuse people with logic. :P
But you are right though.

And for the perceived value of the Switch, it's still overpriced in my eyes. It's more expensive than the other consoles which arguably provide higher degrees of  fidelity and have a larger library of multiplats that I desire to play.

It's only been a month so far for the Switch so of course the library won't be as vast initially. It's not like it's suddenly gonna get 3-4 years of multiplats in one month. Same for any console. Manufacturing cost is apparently what it is. 



Pemalite on 05 April 2017
Kai_Mao said:
Pemalite said:

Depends. Retailers like EB Games here in Australi make a large chunk of cash on refurbished/2nd hand consoles.

Shhh. Don't confuse people with logic. :P
But you are right though.

And for the perceived value of the Switch, it's still overpriced in my eyes. It's more expensive than the other consoles which arguably provide higher degrees of  fidelity and have a larger library of multiplats that I desire to play.

It's only been a month so far for the Switch so of course the library won't be as vast initially. It's not like it's suddenly gonna get 3-4 years of multiplats in one month. Same for any console. Manufacturing cost is apparently what it is. 

Are you suggesting that in 3-4 years it's going to be a Multiplat powerhouse? I look forward to the next Battlefield on Switch if that is the case.





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JEMC on 05 April 2017

That's higher than I thought, although Nintendo gets deals that make the real figure lower than those $257.

Unless sales stall, those looking for a price drop to buy the machine are going to wait for a very long time.



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Random_Matt on 05 April 2017

I'll wait till a Foxconn quote.



aikohualda on 05 April 2017
superchunk said:
aikohualda said:
retailers selling it for free confirmed! :P


$257 including the production cost?

shipment is also expensive...

they expect to sell 30 million by 2018? damn if they pull it... that is very good.... pokemon stars confirmed exclusive to switch :P

I'd bet Nintendo is only making $10~$5 per unit based on this figure. 

10-5 is actually not bad especially if they are projecting 30 mil in 2 years and a half years.... that is 150-300 mil in profit base on your figure... plus the first party games... that would be massive... i mean not wii massive (that was an anomaly), but still decent $$$



 

Barkley on 05 April 2017

30 Million by end of 2018... yeah.... no.

10 Million by the end of this year would be quite optimistic, it's not going to do another 20 million next year.

20-24m by end of 2018, 30m is way too high.



Mummelmann on 05 April 2017

Not a lot of profit margin t toy with should they need a price cut any time soon then, not unexpected.

Also, 30 million by the end of 2018? That's ridiculous. An amazing start would be 10 million this year, that leaves a 100% increase yoy for 2018, something that's more or less never happened with any console in history.



JRPGfan on 05 April 2017
vivster said:
Usually those estimates are on the higher end as they tend to use market value of the parts, not including special deals the manufacturer could have.

Yeah actual costs for nintendo are probably abit lower than that.

I doubt Nintendo spends more than 240$ on it tbh..... This teardown cost analyse is higher than I suspected it would be.

This is depressing news for those hopeing it would get a early price cut.