Nintendo Shares Drop 7% as Switch 2 Price Hikes, Weak Game Outlook Concern Investors

Nintendo shares fell 7% in Tokyo after the company announced price increases for the Switch 2 and investors expressed concerns over a lack of high-profile games to sustain momentum, Sam Nussey reported for Reuters.

Nintendo investors reacted negatively to Switch 2 price increases and concerns over the company’s future game pipeline.

Nintendo posted strong hardware sales for the financial year ended March, but while the company is known for conservative forecasts, its outlook for the current year disappointed the market.

The Kyoto-based gaming giant extended the life of the original Switch with titles from franchises such as The Legend of Zelda.

Although it achieved hits such as “Pokemon Pokopia,” analysts believe the company currently lacks major blockbuster releases in its upcoming pipeline.

“The year-on-year decline in game shipment guidance risks signaling that Nintendo lacks confidence in its pipeline,” Morningstar analyst Kazunori Ito wrote in a note. “However, as user engagement typically accelerates in the second year of a console cycle, we view this as too pessimistic.”

Nintendo also announced price increases for its Switch 2 lineup. The Japanese-language Switch 2 Japan model will rise by 10,000 yen ($63.73) to 59,980 yen beginning May 25, while prices in markets such as the United States will increase starting Sept. 1.