Nintendo has today issued a statement denying that the profit margin on the Switch OLED Model is higher than that of the standard Nintendo Switch model. The statement comes after a report from Bloomberg suggested that each unit sold of the OLED Model would generate about $40 more for the company than the standard units.
Nintendo wanted to make it clear to investors and customers off the back of the Bloomberg report that the company’s profit margin on sales of the Switch OLED Model won’t be any more or less than that for sales of the standard Switch model.
The Bloomberg report Nintendo is referring to looks at the price of the Switch OLED Model, $349.99, which is about $50 more than the standard Switch model. It then covers the potential cost to Nintendo of the additional hardware included in the new system: a larger screen, an ethernet port, and a new kickstand, which are estimated to cost about $10 altogether. Finally, it concludes that, according to its estimates, Nintendo stands to make $40 more on each unit sold.
Nintendo further added that it has “no plans for launching any other model at this time.” This comment refers to yet another Bloomberg report that previously suggested Nintendo is working on a 4K Switch Pro model, aiming to launch it in 2021.
Industry analyst Daniel Ahmad weighed in on the news as well, suggesting that the first part of Nintendo’s statement is true because the company seldom comments on reports or articles made by any press outlet, adding that the profit margin on this new model is, in fact, lower than the standard Switch model. This one could have harmed investor and customer relations, though, which is why it has addressed it so directly. However, Ahmad does believe that profit margins will change over time, and Nintendo could stand to make more profit from this model over time. The second part of the statement, Ahmad says, is purely PR.
Published: Jul 19, 2021 04:13 am