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Switch OLED profit margin is lower than the standard model, not higher, clarifies Nintendo

GamePur logo GamePur 7/19/2021 Jamie Moorcroft-Sharp
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Nintendo has today issued a statement denying that the profit margin on the Switch OLED Model is higher than that of the standard Nintendo Switch model. This comes after a report from Bloomberg suggested that each unit sold of the OLED Model would generate about $40 more for the company than the standard units.

This morning, the company issued a statement addressing a recent report from Bloomberg. Nintendo wanted to make it clear to investors and customers off the back of this report that the company’s profit margin on sales of the Switch OLED Model won’t be any more or less than that for sales of the standard Switch model.

The report Nintendo is referring to looks at the price of the Switch OLED Model, $349.99, which is about $50 more than the standard Switch model. It then covers the potential cost to Nintendo of the additional hardware included in the new system: a larger screen, an ethernet port, and a new kickstand, which are estimated to cost about $10 altogether. Finally, it concludes that, according to its estimates, Nintendo stands to make $40 more on each unit sold.

Nintendo added that it has “have no plans for launching any other model at this time.” This comment refers to yet another Bloomberg report that previously suggested Nintendo is working on a 4K Switch Pro model, aiming to launch it in 2021.

Industry analyst Daniel Ahmad weighed in on the news as well. He suggests that the first part of Nintendo’s statement is true because the company seldom comments on reports or articles made by any press outlet, adding that the profit margin on this new model is, in fact, lower than the standard Switch model. This one could have harmed investor and customer relations, though, which is why it has addressed it so directly. However, Ahmad does believe that profit margins will change over time, and Nintendo could stand to make more profit from this model over time. The second part of the statement, Ahmad says, is purely PR.

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