Nintendo is turning the price screw: The Japanese video game company is significantly increasing the prices for its Switch 2 console and at the same time dampening expectations for the current financial year. As the company announced on Friday, operating profit is expected to increase by only 2.7 percent to 370 billion yen (2.0 billion euros) by the end of March 2027 – significantly slower growth than in the previous year.
In the past 2025/26 financial year, Nintendo increased its operating profit by a strong 27.5 percent to 360.1 billion yen. However, the figures fell short of analysts’ expectations, which put the group’s shares under pressure.
Sales numbers are collapsing
Particularly alarming: Nintendo is expecting a significant decline in Switch 2 sales from 19.9 million to just 16.5 million devices for the current financial year. In order to compensate for the shrinking quantities, the group is resorting to a classic measure – higher prices.
In Japan, the console’s recommended retail price increases from 49,980 to 59,980 yen, an increase of around 20 percent. Prices will also be raised in the USA, Canada and Europe on September 1st. This means that the Switch 2 increases in price from the equivalent of 271.53 euros to 325.85 euros.
Industry-wide cost crisis
With the price increase, Nintendo is responding to a problem that affects the entire gaming industry: the costs of scarce memory chips have risen significantly in recent months. Competitor Sony has also already raised the prices for its PlayStation 5 (PS5) and is struggling with similar challenges. The Japanese rival is expecting a decline in sales in the important games division this year due to declining PS5 sales.
Rising component costs have recently caused concerns among Nintendo investors about the company’s profitability. The stock came under additional pressure because the range of new games for the Switch 2 is considered thin.
Bright spots in the entertainment business
However, positive signals come from other areas: The video game “Pokemon Pokopia” is becoming a bestseller. The latest “Super Mario” movie is also proving to be a crowd puller despite devastating reviews and is likely to bring Nintendo additional licensing income.
Whether the price increases have the desired effect or further dampen demand will become clear in the coming months. In an increasingly competitive market, Nintendo faces the challenge of maintaining the balance between profitability and market share.