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[Abriael_GN]

Nintendo has ripped Bloomberg a new one.




Cases in which companies officially debunk reports like this are extremely rare, as the usual policy is not to comment to avoid indirectly giving credence to reports that aren't explicitly rejected.

That being said, this isn't the first case in recent memory. Square Enix also debunked acquisition speculation following a report, also by Bloomberg, back in April.

I was tempted to add the "NSFW" tag, because Bloomberg is taking it up the rear quite a bit lately. And it was about time.

 

[TonyK]

I don't believe Bloomberg, I don't believe Nintendo.

 

[JORMBO]

Seems like Bloomberg isn’t a good source for gaming news. Who could have guessed that.

 

[Abriael_GN]

Seems like Bloomberg isn’t a good source for gaming news. Who could have guessed that.

I did, long ago.

 

[Banjo64]

I don't believe Bloomberg, I don't believe Nintendo.

Can Nintendo lie? Aren’t they publicly traded?

 

[JORMBO]

I did, long ago.

Heavy sarcasm in my comment

 

[Lions Gate]

but jeff grubb said switch pro is coming soon so it must be true, right ?

 

[Abriael_GN]

Heavy sarcasm in my comment

I know haha, in mine as well

 

[Abriael_GN]

Can Nintendo lie? Aren’t they publicly traded?

Considering that this is addressed explicitly at investors, it would be very much illegal to provide false information.

 

[prinz_valium]

If Nintendo doesn't have a better margin on the new Switch OLED, they're the worst company that ever existed and they should stop doing business at all.

So I have no idea why they feel the need to comment. Probably because this will be marginal and not effect their bottom line as the amount of new consoles sold will be low.


But on a unit cost basis, of couse the margin is higher, lol
Also they say the claim is incorrect and not "our margin on that sku isn't higher"


Usual legal talk.

 

[Abriael_GN]

If Nintendo doesn't have a better margin on the new Switch OLED, they're the worst company that ever existed and they should stop doing business at all.

So I have no idea why they feel the need to comment. Probably because this will be marginal and not effect their bottom line as the amount of new consoles sold will be low.


But on a unit cost basis, of couse the margin is higher, lol

The reason why they feel the need to comment is likely because the false report can affect trading, which is incidentally Bloomberg's goal.

Or maybe they're just sick of Bloomberg saying bullshit about their products haha.

Also, we have no actual reason to believe that the margin is higher. Perception isn't a good source. Nintendo's messaging is *very* explicit, and being addressed to investors directly, it's very, very unlikely to be incorrect. I seriously doubt Nintendo wants to risk an insider trading lawsuit just to give Bloomberg a "up yours!"

 

[DenchDeckard]

with the massive increase in costs of components, that 50 dollar increase in price will get swallowed up pretty darn quick. I personally think that at this exact moment in time, Nintendo are telling the truth. They probably aren't making more money on the thing.

 

[brian0057]

If Nintendo doesn't have a better margin on the new Switch OLED, they're the worst company that ever existed and they should stop doing business at all.

So I have no idea why they feel the need to comment. Probably because this will be marginal and not effect their bottom line as the amount of new consoles sold will be low.


But on a unit cost basis, of couse the margin is higher, lol
Also they say the claim is incorrect and not "our margin on that sku isn't higher"


Usual legal talk.

As much as people like to point out that the Switch OLED is the same a regular Swtich, it requires a different assembly line, new tooling for the injection molds, the new screen, the new dock, etc.
The OLED Model is more expensive but the profit margin compared to the regular model is more than likely the same.

 

[Umbasaborne]

Seems like Bloomberg isn’t a good source for gaming news. Who could have guessed that.

Not surprised to see they are full of shit when it comes to this. I trust them for work place culture pieces, but they have no track record when it comes to accurate leaks about new titles or
Hardware

 

[Panajev2001a]

Can Nintendo lie? Aren’t they publicly traded?

Define lie. Define a Nintendo’s statement as saying anything beyond “we could be making more profit than that” as still making Bloomberg’s statement incorrect.

There is likely a lot of margin for creative accounting to shift costs around and how things are classified to say one thing and its opposite, we do not know the quality of the OLED screen (it might be the best panel known to mankind and Nintendo might be crazy about insane quality control specs).

Still, $50 higher MSRP for a newer screen, a bit more flash, and an Ethernet port in the dock with everything else kind of staying the same (or the chip moving to a smaller manufacturing node) does not raise their profit margins? I do not buy that.

 

[Portugeezer]

I'm sure there is some mental gymnastics going on here by Nintendo.

 

[Panajev2001a]

As much as people like to point out that the Switch OLED is the same a regular Swtich, it requires a different assembly line, new tooling for the injection molds, the new screen, the new dock, etc.
The OLED Model is more expensive but the profit margin compared to the regular model is more than likely the same.

Sure, but as volume ramps up sunk cost on the assembly line and tooling start to lower per unit. I find it hard to believe that profit margins are staying the same with a $50 increase in MSRP…

 

[Abriael_GN]

I'm sure there is some mental gymnastics going on here by Nintendo.

The wording is extremely clear-cut.

More than lkely, the mental gymnastics has been done by the disreputable media outlet with a long history of "anonymous sources" bullshit in all industries.

 

[TLZ]

Surejan.gif.

 

[Marvel14]

All this means is that the original Switch already has massive profit margins.

Anyone thinking core components aren't getting cheaper as time passes doesn't understand Nintendo's business model.

 

[Panajev2001a]

The wording is extremely clear-cut.

More than lkely, the mental gymnastics has been done by the disreputable media outlet with a long history of "anonymous sources" bullshit in all industries.

Are they staying they are keeping the same profit margin? Lower? Higher?

C’mon… years after the original model introduction and $50 higher MSRP for those changes and profit margins are not getting better? Mmmh…

 

[brian0057]

Sure, but as volume ramps up sunk cost on the assembly line and tooling start to lower per unit. I find it hard to believe that profit margins are staying the same with a $50 increase in MSRP…

I agree.
But that will happen when they streamline production. Maybe after a few months they will actually increase their margins.
As of this moment, Nintendo might be telling the truth.

 

[MrA]

All this means is that the original Switch already has massive profit margins.

Anyone thinking core components aren't getting cheaper as time passes doesn't understand Nintendo's business model.

normally yes, but the supply lines are totally messed up right now, though while costs certainly dropped from mar 2017 to mar 2020, the past year and a half has been kind of bad for the cost of electronics
plus plastic prices and shipping costs have spiked too

 

[Fake]

Those insiders having a hard time now.


Of all insiders, Nintendo insiders are by far the worst. And Jason will probably hide in his rock again.

 

[Thesuffering79]

Can Nintendo lie? Aren’t they publicly traded?

Its a "grey statement" for example "no plans for a new model at this time" can mean anything. They have made this statement before and released a new model one month later. IF they said "no plans for a new model for the next 2 years". That isnt a grey statement. See the difference. I've been burnt by Nintendo before like this.

 

[TheMan]

I definitely believe the part about now new models. With the chip shortage, it makes that there will be no new upgrades until the switch’s successor launches

 

[KingT731]

All Nintendo said was "our profit margins for the Switch OLED are not significantly better" because Bloomberg was making it sound like the margins were going up $40. Pretty open and shut.

 

[Bernd Lauert]

People who bought into the "Nintendo is greedy" narrative will keep believing Bloomberg, despite Bloomberg being the fake news media selling clicks and Nintendo being legally obliged to tell the truth to their investors.

 

[Thesuffering79]

All Nintendo said was "our profit margins for the Switch OLED are not significantly better" because Bloomberg was making it sound like the margins were going up $40. Pretty open and shut.

Depends on what is meant by "significantly" right? If they were making $100 of every switch console, then is $40 more on top of that significantly better?

 

[Thesuffering79]

People who bought into the "Nintendo is greedy" narrative will keep believing Bloomberg, despite Bloomberg being the fake news media selling clicks and Nintendo being legally obliged to tell the truth to their investors.

TBF if nintendo wanted to stop the speculation, they would give numbers.

 

[Bernd Lauert]

Depends on what is meant by "significantly" right? If they were making $100 of every switch console, then is $40 more on top of that significantly better?

You guys are making up the "significantly" part, just saying.

 

[wipeout364]

The margins are probably astronomical on the switch given it’s ancient tech and the price hasn’t budged in 4 years, so yes I believe them when they say the bump in price for the OLED model doesn’t increase their margin. They were probably looking at the best time to release it to not decrease their margin.

 

[Thesuffering79]

You guys are making up the "significantly" part, just saying.

I didnt bother to check to OP, my bad. I'm sorry.

 

[ReBurn]

It's interesting how Bloomberg doesn't know anything about video games when it's something we don't want to believe but they're well Informed when it's something we do want to believe.

 

[Punished Miku]

I didnt bother to check to OP, my bad. I'm sorry.

That was a significant apology. All is forgiven.

 

[skit_data]

Are Bloomberg ever right?

Feels like many of their claims over the last year has been dead wrong

 

[KingT731]

Depends on what is meant by "significantly" right? If they were making $100 of every switch console, then is $40 more on top of that significantly better?

Pretty much in any business unless you have their financial information you wouldn't be able to tell them what their margins are in the first place regardless of individual parts cost. So when people who publish articles for Bloomberg come out and say "the OLED screen is only $9" the assumption is made by the general public that the price increase is just Nintendo being greedy or padding their pockets which leads to disappointment among investors who mayhave expected more. So of course they have to come out and set it straight because you don't want to piss off your investors or have them misled.

Edited for clarification.

 

[Abriael_GN]

Are they staying they are keeping the same profit margin? Lower? Higher?

C’mon… years after the original model introduction and $50 higher MSRP for those changes and profit margins are not getting better? Mmmh…

You seem to be literally desperate to find some conspiracy here. Do you work at Bloomberg? The statement says very clearly that the claim that the margins are increased compared to the Nintendo Switch is incorrect. Hence, either the profit margin is the same or lower. There are no two ways about it.

Incidentally, even if the wording was vaguer (and it is not) that does not protect you from legal troubles from insider trading. Any statement that would mislead the markets can be very much ground for a lawsuit, regardless of whether it's vague or specific.

 

[SNPlayen]

Are Bloomberg ever right?

Feels like many of their claims over the last year has been dead wrong

Since Schreier moved there they are seen as being a trusted source. Seen some big bits of wrong info though from them. Didn’t Sony also debunk something they said also?

 

[Abriael_GN]

Since Schreier moved there they are seen as being a trusted source.

Only by people who don't see how much Schreier cherry-picks his "sources" to convey the narrative he wants to convey.

 

[Marvel14]

normally yes, but the supply lines are totally messed up right now, though while costs certainly dropped from mar 2017 to mar 2020, the past year and a half has been kind of bad for the cost of electronics
plus plastic prices and shipping costs have spiked too

Yep...if Switch OLED has the same profit margins as the 4 + year old original Switch (or even the younger Mariko revision) AND there is a tech shortage pushing prices up...then they really are killing it.

I don't know why this is considered bad Nx people feel the need to either attack or defend Nintendo's profitable practices. A profitable Nintendo ensures a competitive and diverse videogame market...

 

[ReBurn]

If Nintendo doesn't have a better margin on the new Switch OLED, they're the worst company that ever existed and they should stop doing business at all.

So I have no idea why they feel the need to comment. Probably because this will be marginal and not effect their bottom line as the amount of new consoles sold will be low.


But on a unit cost basis, of couse the margin is higher, lol
Also they say the claim is incorrect and not "our margin on that sku isn't higher"


Usual legal talk.

With the cost of tooling new production lines to manufacture the new dock and modified case parts for the larger screen, if that was necessary, their margin per unit probably hasn't improved. Probably won't until they reach some sort of economy of scale. We also don't know if they had to make any small changes to the internals to adapt to power requirements for the new screen. In the short term that could also increase cost.

No doubt in the short term manufacturing costs have increased over what they're paying per unit for existing lines. The new dock and ethernet capability confirm that more than the screen has changed.

 

[Magnific0giganticus]

Everyone lies on Twitter, even the honorable japanese.

 

[ZehDon]

Damn. Nintendo is tired of Bloomberg’s shit.

 

[Kilau]

Damn. Nintendo is tired of Bloomberg’s shit.

 

[Hendrick's]

Bullshit. How could it not be a higher margin?

 

[GuinGuin]

A blatant lie. No way in hell a 720p OLED screen costs more than $10 as an upgrade to a LCD when buying in bulk.

 

[Birdo]

All that R&D for an update that doesn't even increase profit

 

[Abriael_GN]

A blatant lie. No way in hell a 720p OLED screen costs more than $10 as an upgrade to a LCD when buying in bulk.

because you say so? Tooling, molds and so forth pay for themselves, right?

There are a *lot* more expenses going into the launch of a new console model than simply "slap a new screen in it."

 

[GuinGuin]

because you say so? Tooling, molds and so forth pay for themselves, right?

There are a *lot* more expenses going into the launch of a new console model than simply "slap a new screen in it."

Bloomberg says so and I agree with them.