As part of Nintendo's nine-month financial report for the 2022/23 fiscal year, the company has said that supply issues that have constrained production for several years now were "largely resolved" in the closing months of 2022.
Commenting on Nintendo Switch sales in its explanatory materials, the company states that the global semiconductor shortage and supply chain problems that have plagued manufacturers of consumer electronics for some time now had little effect on its output between October and December last year.
For the months of October through December 2022 which encompass the holiday season, the effects of shortages of semiconductors and other components was largely resolved, and shipments generally went according to plan. However, unit sales were down compared to the same period last year, when Nintendo Switch – OLED Model was released.
The Switch uses more mature tech than Microsoft and Sony's more powerful systems, so the supply shortage arguably had less of an impact on Nintendo than its competitors in the video game space. Both Xbox and PlayStation consoles use more advanced silicon with comparatively lower yields than Switch's more mature components. However, even the supply of those consoles has been increasing in the past months, with stock now more commonly appearing on store shelves.
According to Nintendo's Q3 FY2023 financial results, Switch sales declined by 21.3% year-on-year over the holiday season, with 14.91 million units sold across its three Switch SKUs in the first three quarters. Nintendo had cited production issues as a contributing factor to its hardware sales figures earlier in the year and was "uncertain" over Switch production heading into 2023. That no longer seems to be the case, at least for its existing console lineup.
Software sales also declined by 4% year-on-year, with 172.11 million units shifted by the end of Q3. Overall, Nintendo has modified its overall hardware forecast for the fiscal year down from 19 to 18 million unit sales, as well as slicing 5 million off its software sales forecast. The company now expects to sell 205 million software units total by the end of March.
Though sales are slowing, Switch is still performing well — it has now overtaken Game Boy and PS4 in the all-time best-seller rankings. With the console soon to enter its seventh year on shelves, however, a decline like this is hardly a surprise. All investor eyes will likely be on potential new hardware announcements from Nintendo over the coming year.