Hold onto your gaming devices because the upcoming release of the Nintendo Switch 2 is set to become pricier. Nintendo announced that the price of the Nintendo Switch 2 in Canada will see an increase starting September 1, with the new price set at $679.99 Cdn, up from the current $629.99.
In Japan, the price of the Switch 2 will also rise to 59,980 yen from 49,980 yen, effective May 25. Nintendo attributed this price adjustment to changes in market conditions and a consideration of the global business outlook. President Shuntaro Furukawa stated that the decision to raise prices was influenced by higher component costs and various factors like exchange rates.
The surge in memory chip prices has impacted major Japanese exporters, including Nintendo and Sony. The ongoing memory chip shortage, exacerbated by the artificial intelligence boom, is straining chip supply and causing disruptions across the tech industry. Memory chip prices have doubled in the first quarter alone and are projected to increase by up to 63% in the current quarter due to high demand from AI data centers affecting supply for various devices.
Nintendo estimated that higher component costs, particularly for memory, alongside tariffs, are anticipated to add approximately 100 billion yen ($874 million Cdn) to costs in the current financial year. Analysts, like HSBC’s Kazunori Ito, highlighted that the escalating memory costs have compelled Nintendo to raise prices, indicating a challenging market environment with little relief in the near future.
Despite the price hikes, Nintendo expects profitability to remain relatively stable compared to the previous financial year. In the fiscal year ending in March, Nintendo reported a net profit of 424 billion yen, up from nearly 279 billion yen the previous year, with annual sales increasing by 99% to 2.3 trillion yen.
Looking ahead, Nintendo anticipates a profit decline of 11% for the fiscal year ending in March 2027, factoring in the planned price adjustments. The company projects a decrease in Switch 2 sales to 16.5 million units, down from 19.86 million in the previous fiscal year, while software sales are expected to grow to 60 million units.
Nintendo’s stock price rose by 3.6% following the earnings announcement. The Switch 2, a hybrid gaming console, continues to attract demand, and Nintendo plans to release more software titles, including those from third-party developers, to further enhance the gaming experience for users.