Lockdown restrictions in Malaysia and the Philippines might lead to production disruptions.
Like many other companies, Nintendo has felt the impact of the production and manufacturing disruptions that have been brought about by the COVID-19 pandemic, and though their stock supplies have started to recover to some degree over the last couple of weeks, it looks like they might be gearing up to face even more stock shortages toward the end of this year.
A recent report by Bloomberg talks about the lockdown restrictions that are in place in Malaysia and the Philippines. Both nations are crucial for Nintendo’s manufacturing process. Nintendo’s printed circuit boards (of PCBs) are made in Malaysia, while components for those boards are procured from the Philippines, and the lockdowns in both nations have led to disruptions in their supply line.
“The inventory may recover in the summer, but we may see shortages again toward the year-end because Nintendo wouldn’t be able to produce enough units for the shopping season,” Ace Research Institute analyst Hideki Yasuda says.
Recently, during their quarterly financial briefing, Nintendo revealed that their projections for Switch hardware sales for financial year 2020-21 stand at 19 million, which is down from the 21 million units they sold during FY 2019-20.
Meanwhile, during the same briefing, they also said that if the coronavirus situation is prolonged or escalates, they might be affected in several ways, including production shortages, delays to development schedules of games, providing online services, and more. Read more on that through here.