Nintendo will raise the price of the Switch 2 in the U.S. to $499.99 from $449.99, effective Sept. 1, as rising memory chip costs and a broader component shortage pressure the company's bottom line.
The price increase extends to other markets as well. In Japan, the Switch 2 will rise from ¥49,980 to ¥59,980 starting May 25. In Canada, the price will increase to $679.99 from $629.99, and in Europe it will rise to €499.99 from €469.99 on My Nintendo Store. Nintendo cited "changes in market conditions" and the "global business outlook" as the reasons for the revisions, which the company said are expected to persist over the medium to long term.
The price hike arrives alongside a downbeat financial outlook. For the fiscal year ending March 2027, CNBC reports that Nintendo's projected revenue of 2.05 trillion yen falls 11.4% short of the prior year and comes in well under the 2.46 trillion yen that LSEG analysts had anticipated. On the bottom line, a 27% contraction in net profit to 310 billion yen is forecast, versus analyst estimates of 418.5 billion yen, according to CNBC.
Unit sales projections also disappointed: 16.5 million Switch 2 consoles are targeted for the current fiscal year, a step back from the 19.86 million sold in the twelve months just concluded. Elevated memory and component prices, combined with tariff-related headwinds, account for roughly ¥100 billion ($637.8 million) of the drag weighing on the company's guidance, according to Bloomberg.
Operating profit guidance of ¥370 billion came as a particular surprise to the market, landing roughly ¥110 billion beneath the ¥480 billion consensus that analysts had built into their models, according to Bloomberg.
The memory chips inside the Switch 2 have become dramatically more expensive as AI infrastructure spending fuels global demand. Sony $SONY moved first among major console makers, lifting PlayStation 5 prices by as much as $150 back in March, and Nintendo has now followed suit, according to CNBC.
Shares have shed roughly 30% of their value so far this year, their steepest annual decline in a decade, according to Bloomberg. Toyo Research Advice analyst Hideki Yasuda offered a cautious read of the results in comments to Bloomberg: "Nintendo typically starts the year with conservative guidance, but even so, this feels unusually soft. The price increase is understandable given the current macro environment, but if higher prices lead to weaker-than-expected sales, then it raises the question of whether the appeal of the Switch 2 was ever that strong to begin with."
Kantan Games CEO Serkan Toto framed the numbers starkly in remarks to CNBC: "The impact is quite dramatic, as console sales usually go up in the second year — and not down as Nintendo predicts this time."
Nintendo also announced price increases for the original Switch lineup in Japan and for its Nintendo Switch Online subscription service. Playing cards and traditional Hanafuda and Kabufuda card products in Japan will also see price revisions, the company said, citing rising material costs.