Nintendo has announced that it will increase the retail price of its Switch 2 gaming console in several markets, citing rising memory chip prices and changing market conditions. The Japanese gaming company now expects to sell 16.5 million units of the Switch 2 in the fiscal year ending March 31, 2027, down from 19.86 million units sold in the previous fiscal year.
Price Hikes Across Multiple Regions
Starting September 1, the Switch 2 price in the United States will rise by $50 from $449.99 to $499.99. In Japan, the price will increase from 49,980 yen to 59,980 yen effective May 25. Nintendo also confirmed price increases in Canada and Europe. The company stated that the decision was made "in light of changes in market conditions" and after considering "the global business outlook."
Impact of AI Data Center Boom and Tariffs
Nintendo attributed the higher manufacturing expenses to increased memory component costs linked to the global AI data center boom. The company added that its financial forecast includes an impact of around 100 billion yen due to rising component prices and "tariff measures."
Financial Forecast Below Analyst Expectations
Nintendo's forecast for the current financial year came in below analyst expectations. The company expects net sales of 2.05 trillion yen for the year ending March 2027, down 11.4% year-on-year, compared to the 2.46 trillion yen expected by analysts surveyed by LSEG. Net profit is forecast to drop 27% to 310 billion yen, below the analyst estimate of 418.5 billion yen.
Serkan Toto, as cited in a report by CNBC, commented: "The clock was ticking for Nintendo for months now. The impact is quite dramatic, as console sales usually go up in the second year — and not down as Nintendo predicts this time."
Strong Performance of Gaming Titles
Despite the weaker outlook, Nintendo said some of its gaming and entertainment titles continue to perform well. "The Super Mario Galaxy Movie" has earned nearly $900 million globally, while the Switch 2 game "Pokémon Pokopia" has become one of the platform's best-selling games. Nintendo also plans to launch new titles from its "Splatoon" and "Starfox" franchises this year, along with two major Pokémon games next year.
"It is now absolutely critical for Nintendo to release blockbuster first-party games as fast as possible in order to drive sales," Toto added.
