Hold onto your gaming consoles, as the cost of the Nintendo Switch 2 is set to rise. Nintendo announced that the price of the Nintendo Switch 2 in Canada will go up to $679.99 Cdn starting September 1, up from the current $629.99.
This price adjustment follows a similar move in Japan, where the Switch 2 price will increase to 59,980 yen from 49,980 yen on May 25. Nintendo attributed this decision to changing market conditions and a review of the global business outlook. President Shuntaro Furukawa explained that rising component costs, exchange rate fluctuations, and other factors influenced the pricing adjustment.
Due to factors like U.S. tariff increases and escalating costs related to events like the Iran conflict, major Japanese exporters, including Nintendo and Sony, are facing challenges. Both companies are grappling with soaring memory chip prices, which are being driven by the AI boom limiting chip supply and causing disruptions across the technology sector.
The surge in memory chip prices has doubled in the first quarter alone and is expected to rise by up to 63% in the current quarter due to high demand from AI data centers affecting supply for various electronic devices. Nintendo anticipates additional costs of approximately 100 billion yen ($874 million Cdn) in the current fiscal year due to higher component costs and tariffs.
HSBC analyst Kazunori Ito noted that the decision to raise prices reflects the severity of the memory cost increase, indicating that the situation is unlikely to improve in the near term. Despite the price hikes, Nintendo’s profitability is projected to remain stable compared to the previous financial year, as stated by Furukawa during an earnings briefing.
Nintendo reported a net profit of 424 billion yen ($3.7 billion Cdn) for the fiscal year ending in March, with a significant increase in annual sales driven by the demand for the Switch 2. Looking ahead, Nintendo foresees an 11% decline in profit for the fiscal year through March 2027, factoring in the planned price adjustments.
The company expects to sell 16.5 million Switch 2 units in the fiscal year through March 2027, with software sales projected to grow. Nintendo’s stock price also rose by 3.6% following the earnings announcement. The Switch 2, known for its versatility as a hybrid game console, continues to attract consumers, with Nintendo promising a lineup of new software titles this year.