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Forums - Sales Discussion - Switch peak year

         

Which year will the sales of Switch peak?

2020 9 $2,368.45 15.52%
 
2021 31 $7,812.30 53.45%
 
2022 16 $5,014.71 27.59%
 
later than 2022 2 $200.00 3.45%
 
 
Totals: 58 $15,395.46  
Game closed: 07/31/2021

I ignorantly picked last year without knowing what’s up in 2021 so far :). I personally think the games this year are dismal, but the clearing-up of covid-19 is not having the dampening effect I thought so far.

edit: a good reminder that the gaming business is momentum-based



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I voted 2020 because I think late summer and early fall will be tough for Switch this year to top the performance it had last year. Though I bet for 2020, I realized something: we're talking about calendar year and not fiscal year and it's a HUGE difference. Last year Jan and Feb were slightly down vs 2019 but those months are in the final quarter of FY, while for CY they are the first one, so it should be an advantage for 2021 Switch. I think in the end it will be slightly down YoY (like from 28m to 26.5m/27m), and I think Switch OLED won't change that much, probably 2022 will benefit more than the last months of this year. We'll see.



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Otter said:
The_Liquid_Laser said:

It's got to be 2021.  This year is already tracking ahead of 2020, which means it is doing better than the Animal Crossing + beginning of COVID lockdown months.  With a new hardware model + Pokemon, Switch is definitely going to be higher this year.  At the same time, the momentum this year is only slightly higher.  Switch's sales growth was really rocketing up in 2019 and especially 2020.  It's not doing that this year, so I think this is going to be the peak year. 

Next year will be down slightly, but it will still be high (probably 25m+) due to a bunch of solid software releases.  That is why anyone saying Switch 2 is coming in 2023 just has no clue.  Imagine Nintendo saying this in 2022.  "Hey we are having one of the best sales years that any system has ever had.  Why don't we kill off this goose that is laying all of these golden eggs...."  Nope.  That ain't happening.  So while I think 2021 will be Switch's peak year, I think every year 2022 and on will only have mild drops in sales giving the Switch a very long life.

Isn't this exactly what happened in 2010? 
FY ending 2010 DS sold 27m
FY ending 2011 the 3DS was out in Japan (shortly to follow elsewhere)

This is what DS shipments looked like by fiscal year, where 2008 means FY ending March 31, 2008.  In FY2008 they shipped 30.31m units and in FY2009 they shipped slightly more 31.19m.  That looks like what is happening last year (FY2021) and this year (FY2022).  This year is selling slightly higher than last year.  So lets continue this analogy.

DS FYDS SalesSwitch FY
200830.312021
200931.192022
201027.112023
201117.522024successor
20125.12025

The 3DS launched right at the very end of FY2011 (Feb/Mar 2011).  I put in the next fiscal year to show that DS sales were obviously dropping like a rock at that point.  This means that if Switch sales actually do fall off a cliff, then the earliest release for a Switch successor is Feb/Mar 2024.  A 2023 release date is unrealistic even in the most pessimistic scenario.  And if the Switch has gradual drops in sales, then it will release holiday 2024 or later (most likely later).



Slownenberg said:
The_Liquid_Laser said:

It's got to be 2021.  This year is already tracking ahead of 2020, which means it is doing better than the Animal Crossing + beginning of COVID lockdown months.  With a new hardware model + Pokemon, Switch is definitely going to be higher this year.  At the same time, the momentum this year is only slightly higher.  Switch's sales growth was really rocketing up in 2019 and especially 2020.  It's not doing that this year, so I think this is going to be the peak year. 

Next year will be down slightly, but it will still be high (probably 25m+) due to a bunch of solid software releases.  That is why anyone saying Switch 2 is coming in 2023 just has no clue.  Imagine Nintendo saying this in 2022.  "Hey we are having one of the best sales years that any system has ever had.  Why don't we kill off this goose that is laying all of these golden eggs...."  Nope.  That ain't happening.  So while I think 2021 will be Switch's peak year, I think every year 2022 and on will only have mild drops in sales giving the Switch a very long life.

Mostly agreed. Nintendo could keep Switch going to like 2026 or so if they wanted to. But I suspect they will sort of cut it off, not in 2023 obviously, but perhaps launch Switch 2 in holiday 2024. I'm thinking Nintendo might not even bother ever discounted the Switch and Switch Lite. Didn't they not really ever even drop the Wii U's price despite the terrible sales, or maybe dropped it $50? Nintendo doesn't seem to like to make business moves to sell more units, they just like to keep prices high and let everyone buy at those prices then move on to the next system.

Switch OLED will allow them to discontinue the original model and drop OLED to $300 eventually and keep that price for a good long while. They COULD drop the prices of the systems in 2024 and 2025 and 2026 and keep the thing selling and maybe even launch that rumored but false 4k upgrade model to also keep a higher price point in there and keep excitement for the Switch going well in to the middle of the decade. But I see them not bothering much in the way of price cuts on anything and just allowing the market to saturate at the initial launch prices and readying Switch 2 by end of 2024. That way they have a new system on the market just after Switch sales start dropping below 20mil a year (I figure Switch will drop under 20mil in 2024, with or without a successor launch. Could happen in 2023 but Switch might be just over 20mil in '23) so that they don't have any low hardware years since they don't have a second system to back things up.

Nintendo will most likely bundle in games first before they do any price drops.  But they have a lot of time left to first do bundles and then do price drops. 

Usually, video game hardware does not generate much profit.  However, the Switch is different.  It was already sold at a slight profit at launch, and it's been on the market at full price for so long, that it has to be making them a lot of profit per sale.  They can actually do bundles in 2022-2023, and then start with price drops in 2023-2024 and still make a ton of profit.  I think it is unlikely for them to leave this much money on the table.  One big difference between Nintendo and Sony is that Nintendo has a lot of evergreens.  Every Switch sold is going to lead to quite a few evergreen sales.  Playstation games end up discounted at Gamestop (and similar stores) pretty quickly, so Sony doesn't necessarily see a cheaper piece of hardware turn into a lot of software revenue at the tail end of a system's life.  Nintendo evergreens keep selling though.  So, a $50-$100 price drop in 2024 is going to generate a lot more profits for the Switch both in hardware and in software.

Overall, I still can't say when the Switch successor will release.  I think it is too early to tell.  I know Switch is going to sell well in 2022, but what about 2023?  If it has a big drop in 2023, then I think Switch 2 will get a 2024 release.  On the other hand, I think it is more likely that Switch will still sell 20m+ in 2023 given how much room Nintendo has for bundles and price cuts.  If it does that, then I think Switch 2 will release in 2025 or later. 

Nintendo's business side is very conservative, and they are down to one main system now.  Given how much money the Switch is making them, I just can't see Nintendo being eager to kill off the goose that is laying the golden eggs.



2022

- Open World Pokemon

- New Zelda

- Splatoon 3

- Metroid Prime 4?

- Mario+Rabbids 2

- Some Major 3rd Party Game

- 2D Mario?

- New Switch Model



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2022 I choose you! Since Switch (4k addition) plus all the 5A games that will cometh out :P



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The_Liquid_Laser said:
Otter said:

Isn't this exactly what happened in 2010? 
FY ending 2010 DS sold 27m
FY ending 2011 the 3DS was out in Japan (shortly to follow elsewhere)

This is what DS shipments looked like by fiscal year, where 2008 means FY ending March 31, 2008.  In FY2008 they shipped 30.31m units and in FY2009 they shipped slightly more 31.19m.  That looks like what is happening last year (FY2021) and this year (FY2022).  This year is selling slightly higher than last year.  So lets continue this analogy.

DS FYDS SalesSwitch FY
200830.312021
200931.192022
201027.112023
201117.522024successor
20125.12025

The 3DS launched right at the very end of FY2011 (Feb/Mar 2011).  I put in the next fiscal year to show that DS sales were obviously dropping like a rock at that point.  This means that if Switch sales actually do fall off a cliff, then the earliest release for a Switch successor is Feb/Mar 2024.  A 2023 release date is unrealistic even in the most pessimistic scenario.  And if the Switch has gradual drops in sales, then it will release holiday 2024 or later (most likely later).

I don't think FY 22 being higher than 21 is a given at this point. That would be in amongst the most pesimistic scenario, but I see your logic



Are we talking purely hardware sales? Or also software?
Is it base units only? Or revenue?



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Jumpin said:

Are we talking purely hardware sales? Or also software?
Is it base units only? Or revenue?

Switch hardware units sold in the calendar year.

EDIT: edited the OP to include this clarification.

Last edited by Mnementh - on 08 July 2021

3DS-FC: 4511-1768-7903 (Mii-Name: Mnementh), Nintendo-Network-ID: Mnementh, Switch: SW-7706-3819-9381 (Mnementh)

my greatest games: 2017, 2018, 2019, 2020

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bets: [peak year] [+], [1], [2], [3], [4]

I'd say 2022 due to the software and potential upgraded Switch model incoming.