As the battle to rule the next generation of high definition gaming wages on, Nintendo continues to exist in a realm all its own. The oldest console company still in play today, Nintendo seems content to simply do things its own way. And that strategy appears to be working, as the company has just ordered higher output from Switch gaming console production.
Demand for the new console continues to rise but shipments seem to be in short supply. With this added output, though, Nintendo hopes to be able to address the call ahead of the winter holiday season, when video game sales tend to perform very well. And at the $300 price point, the Nintendo Switch will probably be the fastest selling gaming device of the season, perhaps of the company’s entire history.
Of course, Nintendo has not tried to make a machine that competes with the powerhouse processors of Sony’s Playstation 4 and the Microsoft’s Xbox One. Instead, Nintendo intends for the console to bridge a gap, so to speak, between traditional television-based gaming and portable gaming (hence the name, “Switch”). The success of the console, so far, has boosted investor confidence, which is reflected in the fact that sales have hit their highest level in nearly a decade.
Obviously, Nintendo’s success is not singular; other companies get to enjoy their rise to the top along with them. For example, the US big box retailer Best Buy has seen spikes in shares—at an all-time high, now—when the Switch first hit the market. Shares in one of Nintendo’s key component suppliers, Hosiden, also surged, of course (to a 7-year high). On Friday, the very popular video game publisher Capcom also saw stocks jump (to a 6-month high) after it simply tweeted that it would release “Monster Hunter” (a current next-gen hit) for the Switch as well.
The bigger question remains, then, as to whether or not Nintendo can actually keep up with demand. After all, Nintendo has a bit of a reputation for poorly predicting consumer demand. For example, Kazunori Ito—an analyst with Morningstar affiliate Ibbotson Association Japan—says “Nintendo’s user base has expanded beyond the company’s expectations partly thanks to Pokemon Go, which has made it difficult for the company to predict demand even for traditional software such as Zelda and Mario Kart.”
Still, gaming industry consultant Serkan Toto comments, “You cannot go into the management’s heads, of course, but I think they just miscalculated demand. It’s not as though they need to create a buzz—there already is one.”