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Forums - Nintendo Discussion - So... Will Nintendo be able to ship those 20 million Switch units?

colafitte on 04 January 2019
RolStoppable said:
colafitte said:
Lol, there it is, already being accused of some type of hater that lowballs switch. So expecting 85-90 lifetime for switch is lowballing...

And sorry, but I find insultingly condescending that you tell me how to use the words "in fact". I used the only way I can be 100% correct because I chosed to say that the only fact is that I'm expecting something to happen being the fact the act to expect itself (if I'm right or wrong is not important).

What I'm going to do is never talk about switch again in this site. I'm tired of being accused of things. Everytime someone here doesn't agree with me he or she feels free to accuse me of whatever they want when in my case I treat everyone here with respect.

I already said what I expect of things to come. No more porpuse arguing anymore.

So yeah, switch is going to dominate the world. Enjoy future discussions with people that think the same as you.

Now that's an overreaction.

If you are curious why the tone is getting harsher, it's because you don't respect the facts to a sufficient degree. And yes, expecting Switch to do only marginally better than 3DS when Switch is growing the sales gap between itself and the 3DS... that is lowballing, because it basically necessitates the expectation that Switch will decline the same or even worse than the 3DS after year 3. After the first full fiscal year, Switch led by ~0.5m. After the second full fiscal year, the 3DS was at 31.09m, so Switch's lead will be 3-6m depending on how it plays out. The 3DS shipped 12.24m in its third full fiscal year, so Switch having a lead of 10m+ is realistic by that point. At that point your lifetime prediction requires that Switch drops to 8.73m, 6.79m, 7.27m and 6.40m in the following four fiscal years in order to work, because you expect Switch to sell only 10-15m more than the 3DS lifetime.

My recommendation is that we simply wait until the end of the month and see what Switch's shipments are for Q3 of the fiscal year, and then reflect on whose arguments were better. I don't believe that you are one of those lost causes, rather you are someone who is reluctant to accept something before it has happened. In this specific case you are of the opinion that 18m for the fiscal year is an optimistic high end expectation while others, including me, are saying that it is on the low end. Personally, I expect between 18-19m with the information we have currently available; Q3 should bring the tally to ~15.5m and another ~3m in Q4 will make it ~18.5m.

Fair enough, but really, i won't discuss any more because i have nothing more to say either.

I've been very clear since the beginining:

Switch 16-16'5M sold in 2018, 29-29'5M sold lifetime at the end of 2018, 9-10M shipped Q3, 32-33M Shipped lifetime by the end of 2018, around 35-36M Shipped by March 2019 for FY18, around 85-90M Lifetime at least in 2023.

If it's 10'5-11'0M shipped in Q3, totally possible. If it is 18'5M shipped by FY18??, totally possible too; more than 19M shipped?? i seriously doubt it and i find it not possible; 20M or more shipped?? i find it impossible.

How the split is going to be among regions?, i don't know and i don't care (that's why my region split earlier was fishy, because i did not think of that enough).

Now, just wait and see like you said, but i don't think my predictions are lowballing at all, i'm not Michael Pachter....And if i don't agree with people like you with how much Switch is going to sell lifetime, you won't convince me just by saying "Switch is special, first party, indie games" arguments. You and any other who do that just won't convince me only with that. I'm sorry but it  is what it is, and please, you and others, don't take it personally, it's anything like that. Is just that i prefer to think that until more evidential data exists, Switch has yet to prove it can do Wii or DS levels of sales. So far it has not done it yet (and i using the word yet because i can accept it is possible). 

If Switch ends selling more than i thought i will be satisfied, because i prefer each console to sell better, not worse. And if i'm wrong i will admit my mistakes, like i always do, something that is not very common in forums like this.



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peachbuggy on 04 January 2019

11.5 or even more shipped for Switch in Q3 2018 is entirely possible, as is 3.5m in Q4, with said momentum. Not sure if this would be enough to meet their FY goals but, whilst a hard task i don't see it as impossible either.



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Mbolibombo on 04 January 2019
peachbuggy said:
11.5 or even more shipped for Switch in Q3 2018 is entirely possible, as is 3.5m in Q4, with said momentum. Not sure if this would be enough to meet their FY goals but, whilst a hard task i don't see it as impossible either.

They need 14.9M to hit their forecast. So your numbers are pretty much dead on what they need.. or something similar, myself is leaning towards another 0.5M in Q4 and 0.5M lesser in in Q3.

 



Megiddo on 04 January 2019

If they overshipped Q3 then it will be harder to possibly overship even more for Q4. I'll be interested to see how it ends up.



Jumpin on 04 January 2019

As I have said before, people are conflating sales with shipments; and while one number does have an impact on the other, given the volume at which the Switch sells (and expectations for big numbers in this calendar year due to Pokemon Switch), the shipments have the capacity to exceed sales by a fairly large number. As it stands, the bottleneck for the Nintendo Switch shipments is not retail sales, it's manufacturing. There's no reason to suspect Nintendo will ship less than 20 million if they say that's what they're doing; the only thing that will change that is if something goes wrong at manufacturing.

Remember, they're not shipping to retail shelves, they're generally shipping to warehouses.

Last edited by Jumpin - on 04 January 2019

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PortisheadBiscuit on 04 January 2019

The chop licking for Nintendo to miss their forecast is extremely palpable.



zorg1000 on 04 January 2019
Megiddo said:

If they overshipped Q3 then it will be harder to possibly overship even more for Q4. I'll be interested to see how it ends up.

I'll give a recent example

PS4 shipped 9.7 million in Q3 2016 bringing the total to 57.1 million.

Sell through at the end of 2016 was 53.4 million so 3.7 million shipped vs sold difference. In Q4 they were still able to ship 2.9 million.

I dont think it should too much of an issue.



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Mbolibombo on 04 January 2019
Jumpin said:

As I have said before, people are conflating sales with shipments; and while one number does have an impact on the other, given the volume at which the Switch sells (and expectations for big numbers in this calendar year due to Pokemon Switch), the shipments have the capacity to exceed sales by a fairly large number. As it stands, the bottleneck for the Nintendo Switch shipments is not retail sales, it's manufacturing. There's no reason to suspect Nintendo will ship less than 20 million if they say that's what they're doing; the only thing that will change that is if something goes wrong at manufacturing.

Remember, they're not shipping to retail shelves, they're generally shipping to warehouses.

I'll just quote this to highlight it further. This is correct.

Nintendo did not lower their forecast after Q2. Thus they will and can ship what they feel they need to ship for Q3 to hit their forecast.



Jumpin on 04 January 2019
RolStoppable said:
Mbolibombo said:

I'll just quote this to highlight it further. This is correct.

Nintendo did not lower their forecast after Q2. Thus they will and can ship what they feel they need to ship for Q3 to hit their forecast.

Why is Jumpin's post correct?

The issue are indeed retail sales, i.e. demand in the marketplace. Retailers won't buy the necessary units if the consumer demand isn't there. Nintendo defines 'shipped' as 'sold to retailers', so while it is clear that here is no problem to manufacture 20m units during this fiscal year, it's also obvious that those 20m won't be shipped if retailers aren't ordering them.

The commonly brought up idea of channel stuffing only works for holiday quarters, because outside of that retailers can't be convinced that there will be more demand than expected. The consequence of a stuffed channel is that Q4 of the fiscal year will be soft, because retailers have to work through their excess stock before they buy more units from the console manufacturer. If Nintendo for example shipped 11.5m in Q3 of this fiscal year while units are piling up at retailers, then Q4 would have a hard time to be above 2.5m.

zorg1000's example supports this despite him thinking otherwise. Sell-through of the PS4 from January to March 2017 was comfortably above 3m, but shipments were under 3m.

I'm going to knock this one out at the premise on which your whole argument sits.

For your post to be of any contradiction against mine, you'd have to demonstrate that the demand isn't there.

The Switch is selling quite well, and with an already healthy 2019 lineup announced with headlines like Pokemon coming up in 2019, there is no reason to think that consumer demand won't continue to be there, and high; and it's evident for any retail chains that this is the case.



I describe myself as a little dose of toxic masculinity.

Mbolibombo on 04 January 2019
RolStoppable said:
Mbolibombo said:

I'll just quote this to highlight it further. This is correct.

Nintendo did not lower their forecast after Q2. Thus they will and can ship what they feel they need to ship for Q3 to hit their forecast.

Why is Jumpin's post correct?

The issue are indeed retail sales, i.e. demand in the marketplace. Retailers won't buy the necessary units if the consumer demand isn't there. Nintendo defines 'shipped' as 'sold to retailers', so while it is clear that there is no problem to manufacture 20m units during this fiscal year, it's also obvious that those 20m won't be shipped if retailers aren't ordering them.

The commonly brought up idea of channel stuffing only works for holiday quarters, because outside of that retailers can't be convinced that there will be more demand than expected. The consequence of a stuffed channel is that Q4 of the fiscal year will be soft, because retailers have to work through their excess stock before they buy more units from the console manufacturer. If Nintendo for example shipped 11.5m in Q3 of this fiscal year while units are piling up at retailers, then Q4 would have a hard time to be above 2.5m.

zorg1000's example supports this despite him thinking otherwise. Sell-through of the PS4 from January to March 2017 was comfortably above 3m, but shipments were under 3m.

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.