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StarTopic Future Nintendo Hardware & Technology Speculation & Discussion |ST| (Read the staff posts before commenting!)

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fwd-bwd said:
To take my mind off the supreme court absurdity (and it's not only RvW), I looked at Nintendo's shareholder disclosures (source) for clues to the next Switch model's production and release window. Below is the unconsolidated inventory data from the Switch era (FY03/18 to FY03/22), and I highlighted the outlying numbers for further discussion:

qMCUB4C.png

  • The finished goods at the end of 03/2018 was high because of the 3DS stock.
  • At the end of 03/2019, the raw materials and work in progress were both elevated, possibly to ramp up the early product of Lite and v2 Switch. As you may recall, the Lite backplate was leaked in 04/2019.
  • Due to COVID factory shutdown, the finished goods and work in progress at the end of 03/2020 were both at the lowest levels.
  • The strong demands stemmed from shelter-in-place resulted in a low finished goods (stock turning over quickly) and high work in progress (mass production to meet demands) at the end of 03/2021.
  • Things are getting interesting this year. As one'd notice immediately, Nintendo is stockpiling raw materials for no apparent reason, while the finished goods and work in progress remain stable.
  • The money tied up in the raw materials is about twice as much as in 03/2019, back when Nintendo was ramping up the Lite and v2 production. Are they preparing to start manufacturing a new model that would cost much more than the Lite and v2? (Yes, there's inflation going on, but that alone doesn't explain the 2x increase.)
  • Note that the work in progress level is not elevated. It seems to indicate that at least at the end of 03/2022, the production of this new model had not been commenced.
Tl;dr, at the end of 03/2022, Nintendo's raw material inventory was at the highest level since the Switch was introduced. The previous peak (03/2019) was for the Lite and v2 production. If this is a precursor of the next Switch model, the work in progress inventory level suggests that the manufacturing of said model had not yet begun by March.

Disclaimer: I'm not a financial analyst. Vash and other experts probably can shed more light on this.
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I just took a closer look at this. Where exactly are you getting the unconsolidated data, and why are you using the unconsolidated data?

Note 1 in the annual report is the consolidate data. Raw materials were $114m (USD) as of March 2021. This compares to $158m in March 2020, $315m in March 2019, $115m in March 2018, and $28m in March 2017.

I don’t see the 2022 AR yet but they have for sure stockpiled something.

As mentioned above, it could be due to supply chain issues, not new hardware. But let’s hope.
 
2024 has always felt like a pessimistic / late prediction with the context of devkits being in developer's hands since late 2020 and the progress of NVN2 in the Nvidia leak.

And we have people speculating 2024 or beyond? That doesn't track.
 
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Vash_the_Stampede said:
I just took a closer look at this. Where exactly are you getting the unconsolidated data, and why are you using the unconsolidated data?

Note 1 in the annual report is the consolidate data. Raw materials were $114m (USD) as of March 2021. This compares to $158m in March 2020, $315m in March 2019, $115m in March 2018, and $28m in March 2017.

I don’t see the 2022 AR yet but they have for sure stockpiled something.

As mentioned above, it could be due to supply chain issues, not new hardware. But let’s hope.
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I got all these numbers from Nintendo's "notice of the annual general meeting of shareholders" published every year prior to the meeting. As for why focusing on the unconsolidated inventories (instead of consolidated) it's because I believed that the subsidiaries, such as the NOA, are not involved in the manufacturing; since my goal was to find clues for any potential new hardware, the unconsolidated inventories seem less noisy data points to me. Also, Nintendo changed their accounting standard for FY03/2022, which impacted the consolidated inventories but not unconsolidated inventories, therefore it may be cleaner to use the latter.
 
Derachi said:
It was so weird that Nintendo released hardware called “Nintendo Switch - OLED Model”

It’s such a weird, un-Nintendo thing to use such a technical term like OLED in a product name. Would be like if the Nintendo DSi was called “Nintendo DS - Digital Image Sensor Model” or whatever. Like they could have called it something more marketing/catchy, but they just named it after a hardware component.
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i am extremely glad they did it, and im hopeful it means the death of those ridiculous names such as ''new''. Its super to the point. It actually makes me believe the next console will hopefully be called 2.
 
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fwd-bwd said:
I got all these numbers from Nintendo's "notice of the annual general meeting of shareholders" published every year prior to the meeting. As for why focusing on the unconsolidated inventories (instead of consolidated) it's because I believed that the subsidiaries, such as the NOA, are not involved in the manufacturing; since my goal was to find clues for any potential new hardware, the unconsolidated inventories seem less noisy data points to me. Also, Nintendo changed their accounting standard for FY03/2022, which impacted the consolidated inventories but not unconsolidated inventories, therefore it may be cleaner to use the latter.
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Note 1 is the consolidated figure in the AGM. It’s 50% bigger than the unconsolidate figure, about $885 million in USD. That’s almost 10x higher than in the year ago period.

I don’t know the technical details why the parent or the unconsolidated results are disclosed, but they hold less information than consolidated.

Nonetheless, the conclusion doesn’t change; something could be up. My take is that finished good is equivalent to ~4m hardware units. If we assume that raw mats are equivalent to about half a completed unit, then maybe that’s ~8m equivalent units.

My only caveat is that Nintendo typical begins to manufacturer for the holiday in the summer. Could they be starting 3 months earlier due to supply chain? Yes.
 
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Vash_the_Stampede said:
I did. It’s interesting but not definitive. This analysis is muddied by the fact that there are various supply chain issues so many, many different companies have been stockpiling (higher safety stock) components in inventory to avoid/limit production shortfalls. So it could be either.

I’m more drawn to the Company’s forecast of 21m units. We know that they lowball the software guidance but not the hardware guidance.

Given that unit sales are down in most regions in the June quarter, it implies a much bigger second half of the fiscal year. It’s plausible to me they are planning some additional hardware for either the holiday season or March quarter. But it might be minor by our standards.
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Expect the OLED model with a Splatoon 3 edition!
 
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ArchedThunder said:
The number you’re giving is for 4k performance mode at 60fps, while the cost at 30fps is much lower, and this isn’t even taking into account the benefits of going with Ultra Performance or a DLSS branch optimized specifically for the hardware (which were also things he mentioned in the video). I also mentioned something that was also mentioned in the video, for 60fps games they would likely target a lower output resolution, like 1440p, thus decreasing the render time cost of DLSS. On top of that the system seems like it might be a good bit beefier than the theoretical he used as reference, so his render time cost numbers for DLSS on Switch 4k may not be accurate. It’s also weird that you use that video as your evidence when he was rather happy with what the theoretical Switch 4K in his video would be able to achieve with DLSS.

A fixed render time cost based on the hardware and better performance and lower power draw with DLSS are not mutually exclusive. For example, if a Switch 2 game could hit 4k 60fps natively then it would be able to reduce the power draw by dropping the base resolution and using DLSS. The system would have to have fewer tensor cores than literally anybody expects for DLSS to not be worth it compared to native.
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ILikeFeet said:
if they want 60fps with DLSS, they will get it. the only actual limitation is them not wanting to give up some heavy effects. but those would cost more to render than DLSS
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MK10 4k 60fps. Believe. MK8 deluxe should be able to do it native... but if mk10 ends up being 1440p 60fps native, DLSS should push it to 4k and it should be doable.

not expecting any 1080p games to go to 4k on DLSS..
 
ShadowFox08 said:
MK10 4k 60fps. Believe. MK8 deluxe should be able to do it native... but if mk10 ends up being 1440p 60fps native, DLSS should push it to 4k and it should be doable.

not expecting any 1080p games to go to 4k on DLSS..
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Most 4k games will likely have an internal resolution of 720p or 1080p. I doubt they’d waste the wattage and GPU performance on getting any DLSS games up to a 1440p base resolution unless the game doesn’t push the system very hard.
720p and especially 1080p internal resolutions brought to 4K via DLSS still look great.
 
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Vash_the_Stampede said:
Note 1 is the consolidated figure in the AGM. It’s 50% bigger than the unconsolidate figure, about $885 million in USD. That’s almost 10x higher than in the year ago period.

I don’t know the technical details why the parent or the unconsolidated results are disclosed, but they hold less information than consolidated.

Nonetheless, the conclusion doesn’t change; something could be up. My take is that finished good is equivalent to ~4m hardware units. If we assume that raw mats are equivalent to about half a completed unit, then maybe that’s ~8m equivalent units.

My only caveat is that Nintendo typical begins to manufacturer for the holiday in the summer. Could they be starting 3 months earlier due to supply chain? Yes.
Click to expand...
If they were starting 3 months earlier than normal (i.e. April?) then we'd probably have some large production leaks by now. It's more likely IMO that full production hasn't started yet seeing as how we're only hearing snippets from Chinese forums at the moment.
 
Skittzo said:
If they were starting 3 months earlier than normal (i.e. April?) then we'd probably have some large production leaks by now. It's more likely IMO that full production hasn't started yet seeing as how we're only hearing snippets from Chinese forums at the moment.
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I think they mean holiday production of current Switch systems.
 
Have we ever had any more leaks on devkits being out for a new Switch? I know talk was they started going out in 2020 but are the6 still going out or has that stalled now I wonder.
 
ArchedThunder said:
I think they mean holiday production of current Switch systems.
Click to expand...
Oh, I see. That makes sense then, yeah. They could be attempting to bolster their holiday stock much earlier than usual, which could change how their inventory looks at this time of year.

ITSMILNER said:
Have we ever had any more leaks on devkits being out for a new Switch? I know talk was they started going out in 2020 but are the6 still going out or has that stalled now I wonder.
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According to Nate IIRC more were sent out last year, not sure if we've had an update since then.
 
Skittzo said:
If they were starting 3 months earlier than normal (i.e. April?) then we'd probably have some large production leaks by now. It's more likely IMO that full production hasn't started yet seeing as how we're only hearing snippets from Chinese forums at the moment.
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You misunderstood. I’m saying they may be starting to produce the existing SKUs for holidays 3 months earlier. Not a new model.

It sounds plausible to me that Nintendo would want to produce ~10m units by summer 2022 to avoid supply chain issues during holiday 2022. The forecast for the year is 21m units.
 
Vash_the_Stampede said:
You misunderstood. I’m saying they may be starting to produce the existing SKUs for holidays 3 months earlier. Not a new model.

It sounds plausible to me that Nintendo would want to produce ~10m units by summer 2022 to avoid supply chain issues during holiday 2022. The forecast for the year is 21m units.
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Yeah thank you, someone else corrected me above.

That timeline makes sense to me. Do we get these same inventory disclosures for other quarters or is it just yearly?
 
Vash_the_Stampede said:
We get total inventory every quarter, but not the mix of components.

I think we will know if it’s launching this year before the September quarter is released so it’s probably a moot point.
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Well I was more wondering if we could compare the level we see here to past Q2 levels, but if they're not reported then yeah that's a moot point.
 
If Nintendo manages to sell ~4M Q1, ~4M Q2, ~9M Q3 and ~4M Q4 they can hit that number.

Or, 3.7M Q1, 3.7M Q2, 9.9 Q3 and 3.7M Q4

🤭

I suppose it can…. sorta? But it would be tight here and hard
 
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m051293 said:
This spike is because they're having a new building built, isn't it?? Contractors not owing all RM?
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I'm pretty sure building materials (like actual building materials: concrete and drywall and steel bars etc.) would not be included in their raw materials/inventories.
 
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fwd-bwd said:
Thanks again! No rush to reply: The green bars (raw materials) appear bi-annually in the screenshot, but the number is only disclosed once a year. Does the Bloomberg Terminal provide non-public data?
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Looks like there is some more disclosure in the Japanese language semi-annual report and bbg is pulling the data from there.
 
Kenka said:
To everyone new to this thread, here is a post that crushes it. Yes, the poster debunked some of my assumptions, and it is brilliant nonetheless. It explains different usages of DLSS, why it is still desirable for a device that relies on low TDP and why it potentially future proofs the console.
Click to expand...
I've learned a lot from hanging around here, including from your posts. I have a technical background, but in a totally different field. It's awesome that we can have an ongoing conversation.

Kenka said:
@oldpuck : your last sentence must be proved though. Do we have any data that suggests that using DLSS always improves either IQ or framerate?
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It definitely doesn't. I realize I was a little unclear here. What I was getting at was the tradeoff between tensor cores and shader cores. On games where DLSS is NOT useful, how much better would those games look/run if Nintendo had replaced the tensor cores with just more raw shader cores?

It's a really hard question to answer, but probably not much? The GTX 1650 attempted to do just that, relative to the 1660, and doesn't seem to have managed to squeeze any extra performance out relative to its die size/power draw. Someone here might have a better answer. But think of it this way. There are roughly three classes of games
  1. Games that aren't going to have a problem reaching "max" resolution using just shader cores. Anything pure pixel art, for example.
  2. Games that benefit from DLSS. Imagine a game running a comfortable 1080p60fps on the core hardware, that can get down to 720p90fps, leaving them ample time in their framebudget to DLSS up to 1440p60fps, and still look good.
  3. Games that push the hardware, but can't create the room in their framebudget for DLSS without looking bad. These are the games that, in theory, would benefit from dropping Tensor Cores and replacing that with more shader cores or higher clocks.
Group 3 needs a really weird performance profile. If a game runs like a powerpoint at the target res, then they'd need huge amounts of extra shader perf, and sacrificing tensor cores probably won't get you there. If the game runs, say, at a stable 30fps at 1080p, then you probably can get to 720p60fps with enough room in the frame budget for DLSS to get you back up to 1080p60fps.

The place where you really want to toss Tensor Cores for Shader Cores is something like a game running 55fps at your target res. You're close enough that a little bit of extra GPU perf is going to push you over the finish line, but DLSS might be a noticable IQ drop for a tiny boost in performance, and would rather just hand tune themselves back up to 60fps. I think the number of games in that bucket is going to be small, and regardless, the sacrifices those games will have to make will also not be dramatic.
 
m051293 said:
This spike is because they're having a new building built, isn't it?? Contractors not owing all RM?
Click to expand...
Why would the office building affect who owns their raw materials/where they're located? Unless you're suggesting they're including the actual construction materials which would be weird.
 
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