"Switch 2 Release Delayed to Next Year"… Nintendo Stock Drops 6%

Notification of Release Delay to Game Partners

The release of Nintendo Switch's successor console, 'Switch 2,' originally scheduled for this year, has been postponed to 2025. Nintendo's stock price on the Tokyo Stock Exchange plunged nearly 6%.

Bloomberg reported on the 19th that Nintendo has informed its game publishing partners that the Switch 2 launch, initially planned for Q4 this year, has been delayed until early 2025. Some partners were told that a release could not be guaranteed even by Q1 next year.

This immediately dealt a blow to the recently rising stock price. Nintendo's shares had been on an upward trend fueled by expectations for the Switch 2 launch. On the 15th, the stock hit an all-time high. However, following the delay announcement, Nintendo's stock closed down 5.84% compared to the previous session. During the day, it fell as much as 8.8%, marking the largest drop since October 2021.

[Photo by Nintendo official website capture]

Marking its 7th anniversary this year, the Nintendo Switch is a game console with cumulative sales of approximately 139 million units. Along with the news of the next-generation hardware launch delay, the postponement of blockbuster-level software releases expected to follow Nintendo's flagship titles such as The Legend of Zelda, Mario, and Splatoon is believed to have further negatively impacted the stock price.

Mio Kato of Lightstream Research said, "There are not many customers left who will patiently wait for Nintendo's indefinite launch delay," adding, "If Nintendo's hardware continues to age and the release of major software is delayed, Nintendo will face a grim reality at the next earnings announcement."

Video game development consultant Serkan Toto analyzed, "Software is the most profitable business segment, but Nintendo likely does not want users to enjoy new titles from major franchises like The Legend of Zelda, Mario, and Splatoon on outdated consoles."

According to the report, Nintendo President Shuntaro Furukawa avoided questions about new hardware after this month's earnings announcement, stating, "Nintendo's future blueprint will be revealed after this fiscal year (April 2023 to March 2024) ends." He added that since 139 million units have already been sold, it would be difficult for existing Switch sales to increase further. The report assessed that if Switch 2 is not released during the upcoming holiday season, Nintendo will struggle to compete against much newer and more powerful consoles such as PlayStation (Sony) and Xbox (Microsoft).

There are also voices viewing Nintendo's stock price decline as a buying opportunity. Robin Zhu, an analyst at Bernstein, predicted, "There will be an announcement about Nintendo's new hardware within the next six months."