Nintendo Co. cut its outlook for annual Switch shipments, the strongest sign yet that the hybrid console is struggling to attract a wider swath of users and become a worthy successor to the Wii.
Shares of Nintendo fell as much as 6.9 percent after it forecast 17 million Switch shipments for the fiscal year through March, compared with its prior outlook for 20 million units and analysts' average prediction for 18 million. The revision comes even as the Kyoto-based company reported better-than-projected profit during the December holiday shopping quarter.
The big question is whether Nintendo will have to cut the Switch's ¥29,980 (about $300) price tag to get more people to buy the device, which can be used at home or on the go. Like the PlayStation and Xbox consoles, more hardware users fuels greater demand for software, creating a virtuous cycle of demand. But so far, President Shuntaro Furukawa hasn't succeeded in expanding the Switch beyond a base of loyal customers.