GameStop on the positive sales impact of Switch, strong demand to continue, pre-owned sales talk - Nintendo Everything

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GameStop on the positive sales impact of Switch, strong demand to continue, pre-owned sales talk

Posted on November 26, 2017 by (@NE_Brian) in News, Switch

GameStop reported its Q3 financial results this week. The retailer said that Switch has experienced “continued momentum” and help drive an 8.8% increase in hardware sales last quarter. Additional details about the impact of Switch were shared during a financial call.

According to CFO Rob Lloyd, GameStop still has the “market leading share on Switch and the highest attaching the industry.” Additionally, “GameStop has leading Switch hardware and software market share in the U.S. and in most of our international markets.”

Nintendo’s console helped offset decline in certain areas. As one example, while pre-owned sales were down, new software sales growth was driven by Switch.

Lloyd also said in the call that demand is still strong. GameStop anticipates “continued strength in demand for Switch through the holiday sales season.” GameStop expects its Q4 hardware sales to be driven by Switch.

Regarding Switch demand and supply for the remainder of the year, Lloyd said:

“Our expectation is that demand for Switch will continue to outpace supply for the remainder of the holiday season and for this to be one of the most sort after gifts. We are working closely with Nintendo to ensure that we are best able to meet the holiday needs of our customers.”

Lastly, one interesting question was brought up concerning pre-owned sales. When asked when Switch will be a factor in that area, executive chairman and interim CEO Dan DeMatteo as well as CEO Tony Bartel responded with the following:

“So, what we see there is actually an interesting dynamic relative to where we were four years ago. So, on the Switch, we would expect that that would be a more meaningful contributor to our preowned business probably in the latter half of 2018, just recognizing that part of that dynamic is that it’s the new console on the block. So, people that are buying the Switch are playing those franchise titles that Nintendo has released Zelda, Mario Kart, Super Mario that keep them engaged with that platform.

In contrast, if you look back four years ago, it did not take as long for the PlayStation 4 and the Xbox One to work their way into our preowned business because you had those two consoles kind of competing with each other. And so, you had that consumer that would try one and decide they wanted to go with the other traded in and sort of switch [indiscernible]. So, the dynamics is just different this time.” – Dan DeMatteo

“Generally, about 180 days is typically what we see of games on consoles coming in, on average that has been kind of the last 10-year average, like Rob said and the Switch console may elongate a bit.” – Tony Bartel

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  • DonSerrot

    You also have the fact that Nintendo gamers tend to be more on the collector side and usually keep their games. Some games will get traded sure, but Nintendo pre-owned sections don’t ever even come close to the other console’s. Some might say that speaks to the quality of Nintendo’s games. πŸ˜‰

    • YamiryuuZero

      I have a friend who keeps trading his stuff for different stuff. If he has a Wii U today, tomorrow he’ll be trading it for a PS4. Then, a few months after, he’ll be looking into trading something else for a Wii U again because he misses playing Mario Kart or Zelda.

      I can never understand why he does that. I keep everything I own close to me, in case I want to play again. I only got rid of my SNES and its cartridges (sold them to this friend I mentioned) because I was desperate after money and he wanted to buy them, if not for that, I would still have them and would be playing the games on my CRT TV still.

      I mean, I understand someone returning a bad game, like Other M or that sadistic game where you do nothing but shoot people without any objective (what was it called again, Rage? Anger? I don’t remember), but the guy will trade even his favorite games for stuff he doesn’t even know if he’ll like or not.

      • Mark

        I agree. The only time that I’ve ever traded something in is when I was much younger and just didn’t like the game at all.

        Otherwise, I’ve occasionally sold games on ebay, but usually only after I’ve owned them for 10+ years, *know* that I’m never going to play them again, and have another good reason to do so. When I became a father, all of my disturbing-violent games that need a TV went away. When I was saving up for a Switch, a few of my really obscure N64 and GameCube games went.

        Knowing about how batteries of cartridge games fail, and data on CDs rot, has made me feel a little better about selling what I don’t want anymore.

  • Don Zaloog

    His name is “Rob Lloyd”? Tales Of Symphonia and Rob The Robot reboots confirmed.

  • Tlink7

    Those snow Toads… Snoads