During a recent earnings call, Nintendo revealed that while sales are up, profit is down after a tough year, and already thin margins could get tighter looking ahead to 2026 and beyond.
The call, first reported on by Bloomberg Asia, reveals a profit of 23%, less than expected. This is largely blamed on the 2025 tariffs instituted by the U.S. Trump administration, which impacted several countries where Nintendo produces the Switch 2, including China and Vietnam. Nintendo President Shuntaro Furukawa highlighted the tariff issues while also raising concerns over the impact of rising memory costs.
“The market environment is indeed challenging. But we are engaging in long-term discussions with our suppliers to ensure we maintain a stable intake of chips,” Furukawa said.
You may like
“From the next fiscal year onward, if this price hike lasts longer than anticipated, it could potentially put pressure on our profitability,” Furukawa added.
Price increases?
(Image credit: Tom’s Guide)
Due to the ongoing memory shortage, it’s suggested that Nintendo will sell different kinds of Switches, including new colorways, to ensure profitability. Still, rising component prices will be a struggle for not only Nintendo but also other major tech companies, including Apple and laptop manufacturers like Asus and Lenovo.
In January, Furukawa didn’t rule out raising prices, though he noted that Nintendo is trying to get people to get into the ecosystem.
“While it’s difficult to accurately gauge the future impact, our basic policy is to recognize tariffs as a cost and pass them on to prices as much as possible, not just in the US,” he said.
Later, a research firm predicted that Nintendo is likely to hike prices on the Switch 2 before the end of 2026. Again, thanks to the ongoing RAM crisis and the AI-caused memory shortage.
“We believe the Switch 2 is set to follow in Sony and Microsoft’s footsteps with its own price hike driven by the impact from tariffs, increased memory costs, and broader macroeconomic conditions,” the firm posted.
Follow Tom’s Guide on Google News and add us as a preferred source to get our up-to-date news, analysis, and reviews in your feeds.
