There has been a higher demand for Nintendo Switch consoles that led market analysts to claim that the brand may still expect profit growth this year. However, a report claimed that the latest releases by other brands such as Sony and Microsoft might hurt the sales for Nintendo urging investors to doubt its market potential in 2020.
According to the Motley Fool, Nintendo has matched tech giant Sony and Microsoft's technological capacity in recent months. The report claimed that people have been demanding the product services due to its offering of unique gaming experiences for franchises such as Zelda and Mario.
The report further discussed the growing demand for the products' services indicate a growth potential for Nintendo in the coming years. It was also revealed that the brand's management has been planning to expand its products and game development efforts on two platforms.
Unit sales for Nintendo 3DS were at 620,000 in the last three quarters starting 2019. However, the report claimed that the yield was a 73 percent decline in demand since 2019.
The Nintendo Switch product was also said to have been an active market player for four years in the row with an installed base of 52 million. The unique features of the product such as its handheld console have been earning positive attention in the market that the brand's management has decided to enhance its software development resources to maintain its growth potential.
According to Nintendo's president Shuntaro Furukawa, the business strategy to focus on software development would allow the system to enhance its growth potential and innovate the product to be a stronger player in the home console market.
The report also discussed that the brand would not release a new console this year, but Nintendo was revealed to have a plan to continue making new games for the Switch product line. After Nintendo released its latest earnings, it was shown that new titles would be released for the product to continue to increase its sales growth.
The product was also compared to the PlayStation and Xbox products, its strongest opponents in the market. It was then discussed that the two former products had more advanced graphics processing power than the Nintendo Switch. However, the report then claimed that the Switch is still selling well in the industry. It was also showed that the Nintendo Switch reach a record high for unit sell-through in December 2019 alone.
According to Nintendo's senior executive officer Satoru Shibata, the brand has growth potential in China, but it may only be realized for several years. He then revealed that the company wishes to raise awareness for the brand and would expand its business over the medium to long term in China.
