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Nintendo Aims to Match Switch Success with New Switch 2 Console

Strategic Insights

— 1 min read

Nintendo is optimistic about the success of its upgraded Switch 2 console, despite concerns over its high price point and uncertainty surrounding US trade tariffs. The Switch 2 boasts improved processing power, a bigger screen, and new functions, including online chat capabilities and the ability to temporarily share games with friends. With a price tag of USD449.99 in the US, the Switch 2 is more expensive than its predecessor, but Nintendo forecasts it will sell 15 million units in the current financial year. The company's president, Shuntaro Furukawa, has warned that maintaining momentum over the long term will be challenging, given the device's high price.

Key Takeaways:

  • Nintendo forecasts selling 15 million Switch 2 consoles in the current financial year, roughly equal to the original Switch in the same period.
  • The Switch 2 has improved processing power and a bigger screen compared to the original Switch.
  • The new console features new functions, including online chat capabilities and the ability to temporarily share games with friends.
  • Pre-orders for the Switch 2 have sold out in the US and elsewhere, with particularly high demand in Japan.
  • Nintendo's financial projections are based on the assumption of US tariffs on products from Japan, Vietnam, and Cambodia, and 145% on China.
  • Tariff uncertainty could push consumers to buy a Switch 2 sooner, as they worry about the price potentially going up.

Statistics:

  • 152 million units of the original Switch have been sold since its launch in 2017.
  • The Switch 2 costs USD449.99 in the US, over a third more than the original Switch.
  • The new console has eight times the memory of the first Switch.
  • 90% of Nintendo's revenue still comes from the Switch business, according to analysts.
  • Pre-sale demand for the Switch 2 has exceeded expectations, with Charlotte Massicault, director of multimedia and gaming at Fnac Darty, saying it will be a record in terms of first-day sales for a games console.

Sources:

  • (AP) - "Nintendo Aims to Match Switch Success with New Switch 2 Console"
  • AFP - interview with Krysta Yang of the Nintendo-focused Kit & Krysta Podcast
  • AFP - interview with David Gibson of MST Financial
  • AFP - interview with Charlotte Massicault, director of multimedia and gaming at Fnac Darty

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