Nintendo, Microsoft, Sony, Apple, and many other tech firms have all been effected by the ongoing global chip shortages for their range of products. Speaking to the press, Nintendo president, Shuntaro Furukawa, said that he doesn’t “see an end'” to the global chip shortage and that the outlook “remains unclear” at present. Nintendo announced that they are splitting stock into 10 from October in an effort to prop up the company shares as Nintendo looks to revitalise sales of the five-year-old Switch console and overcome the global chip shortage.
“The outlook on chip shortages remains unclear. We do not see an end to this situation,” he said.Nintendo President, Shuntaro Furukawaa
Bloomberg about the move from Nintendo:
Nintendo needs to drive software sales and live services to support long-term earnings growth as the Switch platform enters the mature phase of its cycle. Hardware sales may keep declining as momentum from Animal Crossing fades further, barring a reported — but as yet unconfirmed — new console. Nintendo may leverage software, particularly first-party games from its smash-hit franchises such as Pokemon and Mario to prop-up top-line and earnings growth. We believe new software releases may offset the supply-side impact on hardware to drive upside to fiscal 2023 consensus.Nathan Naidu, analyst
“The stock split plan would be obviously a boost, I’m just surprised that Nintendo announced a stock-split after having resisted it for such a long time.”
“The only option for Nintendo to prop up the hardware’s sales momentum is to release upgraded hardware.”Yasuo Sakuma, chief investment officer at Libra Investments