Nintendo President Shuntaro Furukawa said in an interview with Nikkei that although semiconductor supply concerns are expected to improve throughout the remainder of this fiscal year, the next year will be more "uncertain." This follows the publication of Nintendo's financial report for the first quarter of 2022-2023.
Nintendo reported a 22.9 percent drop in earnings for April - June 2022, but the company also assured customers that it would not increase the price of the Switch throughout the summer and autumn period.
- Further reading - Nintendo Rules Out Any Price Increase On The Switch In Japan... For Now
Nintendo will "work out the best strategy" as it goes along, and that it's doing its best to "procure high-quality goods at an appropriate price," but things remain unclear for the remainder of the current fiscal year:
"With the help of several business partners, we're on track to improve from the latter half of this summer." However, in terms of our sales forecast of 21 million units for the fiscal year through March 2023, we only have a clear production outlook for this year.
Nintendo Switch supply should increase for the remainder of the year due to this cooperation, although it's unclear what the demand and supply will be like next year, according to Furukawa. "I can't say specifically what is in short supply," says the company, but that Nintendo will continue to sell all three Switch models, including Standard, Lite, and OLED.
- Further reading - Nintendo Switch Sales Surpass 111 Million
Furukawa confirms that Nintendo isn't considering a price increase "at this time," but the President was confronted with increasing material and shipping costs.
"For the time being, our OLED model will continue to be less profitable than our other models. Shipping costs have certainly increased, both by air and by sea. We're thinking about what we can do.
Nintendo's strong yen may be seen as a gain due to its large portion of sales coming from abroad, but our overseas promotional and staff costs also rise. We're making more inventory purchases in foreign currencies to counteract that.
While the yen is certainly weakening, costs around the world are also increasing, causing Nintendo to consider other options, including as Furukawa asserts above purchasing more inventory in other currencies.
Furukawa raises the issue of shipping costs, and the business must think of a strategy to alleviate this.
The OLED costs more to produce, and while it's more expensive than the standard model (and often the best-selling Switch console week-on-week in Japan), it's only marginally more expensive.
Despite any concerns with supplies, semiconductors, and prices, Furukawa believes that "hit software" in the latter part of the year will benefit the console enormously, specifically citing Splatoon 3 (9th September) and Pokemon Scarlet & Violet (18th November).
Mario + Rabbids Sparks of Hope and Bayonetta 3, while The Legend of Zelda: Breath of the Wild 2 has a chance of being released before the end of the financial year (March 2023) because it's dated in spring 2023.
What do you think about Shuntaro Furukawa's words? Do you think the semiconductor shortage will improve more next year? Let us know in the comments.