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Nintendo forecasts 15 million Switch 2 sales in 2025-26 / Photo: © AFP
NYSE - LSE
Nintendo forecasts 15 million Switch 2 sales in 2025-26
Japanese gaming giant Nintendo forecast Thursday that it would sell 15 million units of its hotly awaited Switch 2 console in the current financial year but warned US tariffs could hit its bottom line.
The successor to the Switch -- the third best-selling console ever behind Sony's PlayStation 2 and the Nintendo DS -- is set to hit shelves worldwide on June 5.
While Nintendo is diversifying into theme parks and hit movies, around 90 percent of its revenue still comes from the Switch business, analysts say.
However the unit sales forecast is more conservative than the 16.8 million expected in a survey of Bloomberg economists.
The Switch, a handheld and TV-compatible device that became a must-have gadget during pandemic lockdowns, has sold around 150 million units since its launch in 2017.
For the financial year that ended on March 31, Nintendo reported a 43.2 percent fall in full-year net profit to 278.8 billion yen ($1.9 billion), as gamers wait to splash their cash on the Switch 2.
Nintendo forecast a net profit of 300 billion yen for the current financial year but warned that US trade tariffs could impact its earnings.
"Changes to tariff rates may affect our financial forecast. We will continue to monitor the situation to respond to changes in market conditions," it said.
The company last month revealed details about the Switch 2, a hybrid console like its predecessor.
However the price has raised eyebrows at over a third more than the original Switch in major markets including the United States, where it will cost $449.99.
A Japanese-only version for domestic consumers will cost 49,980 yen ($350).
Nintendo delayed pre-orders for the Switch 2 in the United States by several weeks as it assessed the fallout from President Donald Trump's trade levies.
But last month it boasted of higher-than-expected demand in Japan for pre-orders of the new console.
Ahead of Thursday's earnings release, Atul Goyal of Jefferies said "we expect demand to significantly exceed supplies" of the Switch 2.
Recent news that the next title in the Grand Theft Auto video game series had been postponed to May 2026 is also a positive for Nintendo, Goyal said.
"GTA6 does not have a direct impact on Nintendo, but it sure makes Nintendo's competition far less intense" in terms of game launches, he wrote in a note.
Y.Slowik--GL
