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Nintendo’s “Switch 2” Dilemma
| cowgod | 02/15/26 |
| cowgod | 02/15/26 |
| goy orbison | 02/15/26 |
| cowgod | 02/15/26 |
| goy orbison | 02/15/26 |
| cowgod | 02/15/26 |
| goy orbison | 02/15/26 |
| cowgod | 02/15/26 |
| goy orbison | 02/15/26 |
Poast new message in this thread
Date: February 15th, 2026 4:52 PM Author: cowgod https://kabutan.jp/news/marketnews/?b=n202602130553
Nintendo’s cumulative Q3 FY March 2026 results showed revenue up 99% year-on-year to ¥1.9058 trillion, and operating profit up 21% to ¥300.3 billion. Switch 2 unit sales reached 17.37 million, slightly below my expectations but still the fastest adoption pace in history. Nevertheless, the stock price fell sharply the next day.
There are three main reasons:
Uncertainty around DRAM prices
Risk from AI technological innovation
Structural losses in the Japanese market
Switch 2 DRAM is supplied under long-term stable contracts, and President Shuntaro Furukawa commented that production volumes are secure for FY2026. Market reactions may be somewhat excessive, but uncertainty has increased.
Regarding AI innovation, some believe generative AI lowers entry barriers, making game development easier and reducing the significance of major studios. Google (Alphabet, GOOG) demonstrated a “world AI generation system” capable of producing environments resembling The Legend of Zelda and Super Mario. This fueled speculation that expensive game development may become unnecessary.
However, Google’s current offering can only create something akin to an interactive animation. It is not a direct competitive threat. While AI may advance rapidly, expertise in game balance and design cannot be easily replaced. And if it can be, Nintendo would likely adopt the technology effectively. A crisis can also be an opportunity.
The third issue is Japan’s profitability structure. Switch 2 is manufactured in Vietnam and costs are largely dollar-denominated. Yen depreciation raises production costs in yen terms. Meanwhile, consoles must be priced affordably to sell. The Japan-only model is priced at ¥49,980 (tax included), a strategic price.
As a result, Switch 2 sold 4.78 million units in under six months in Japan — matching the pace of Nintendo DS, which shipped 9.12 million units in its first year (FY March 2007). But the more it sells, the more hardware losses accumulate; a difficult dilemma. |
Date: February 15th, 2026 5:18 PM Author: cowgod (http://www.autoadmit.com/thread.php?thread_id=5835186&forum_id=2Elisa#49672615) |
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Date: February 15th, 2026 5:20 PM Author: goy orbison Address the allegations (http://www.autoadmit.com/thread.php?thread_id=5835186&forum_id=2Elisa#49672616) |
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Date: February 15th, 2026 5:35 PM Author: cowgod the weak yen is punishing them in the East. Western sales (and, by extension, westerners), are a cash cow and silver lining as long as they keep the price high. Japan sales are low-margin or maybe even negative. But they enjoy being relevant and winning the gen and making Sony irrelevant in the Far East.
Sometimes it feels like Jap companies like Nintendo are ridiculously conservative. I don't think they had enough resources to both come out with a Console and make Games for it. |
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Date: February 15th, 2026 5:41 PM Author: goy orbison They're a movie & theme park & toy company now, video games are low on the totem pole they got a taste of Hollywood and realized u can make more with a retarded 2 hour cgi movie. Probably Disney buys them eventually. Autistic kids are streaming that mario movie 5-6 times per day (http://www.autoadmit.com/thread.php?thread_id=5835186&forum_id=2Elisa#49672653) |
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Date: February 15th, 2026 5:45 PM Author: cowgod I don’t think they make a ton from the movies, other than the fact that they exist for forever and they’ll always get royalties. But they can’t net billions from a few Films, only hundreds of millions (which grow over a long time to billions granted) (http://www.autoadmit.com/thread.php?thread_id=5835186&forum_id=2Elisa#49672663) |
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Date: February 15th, 2026 5:49 PM Author: goy orbison But they can do almost no work and make a lot of money from mario films, they aren't making games anyway. They remaster shit now. Nothing new going on. I think the employees just go into the office and nap and slurp ramen and watch anime. No real work being done. All of japan is like this. Idk how their economy functions (http://www.autoadmit.com/thread.php?thread_id=5835186&forum_id=2Elisa#49672668) |
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Date: February 15th, 2026 5:52 PM Author: cowgod Tbh I’ve never even played galaxy 2 or skyward sword and couldn’t make myself finish TP or galaxy 1.
Their release of the games alongside the movie is also shrewd. Sega has given use close to nothing since the sonic movies released
Maybe we should just stfu and play out Nintendo backlogs |
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Date: February 15th, 2026 6:10 PM Author: goy orbison Trying to (http://www.autoadmit.com/thread.php?thread_id=5835186&forum_id=2Elisa#49672692) |