Nintendo’s Cost To Manufacture A Switch Is Lowering Thanks To Mass Production

Nintendo has published their investors Q&A session for the 9 months ending December 31, 2019. All contents of this article were translated by NintendoSoup.

An investor asked three questions – whether the company’s focus on the Nintendo Switch has any impact on the gross margin ratio, whether the cost of producing the system has decreased, and if the continuous stream of software releases contributes anything to the gross margin ratio.

Nintendo President Shuntaro Furukawa summed up his answers in three parts – the company’s focus on the Switch has no impact on the gross margin ratio, and neither do the continuous stream of software releases, as Nintendo does not factor research and development costs into their cost of production for each game.

He did mention that due to mass production of Nintendo Switch hardware, the gross margin ratio has been improving, meaning the cost of producing the Switch is becoming lower.

What do you think? Let us know in the comments.