Nintendo Co hopes to match the runaway success of the Switch when its leveled-up new console hits shelves on Thursday, with strong early sales expected despite the gadget’s high price.
Featuring a bigger screen and more processing power, the Switch 2 is an upgrade to its predecessor, which has sold 152 million units since launching in 2017 — making it the third-best-selling video game console of all time.
However, despite buzz among fans and robust demand for pre-orders, headwinds for Nintendo include uncertainty over US trade tariffs and whether enough people are willing to shell out.
Photo: AFP
The Switch 2 “is priced relatively high” compared with the original device, Nintendo president Shuntaro Furukawa told a financial results briefing last month.
“So even if there is momentum around the launch, we know it will not be easy to keep that momentum going over the long term,” he said.
Sales of the Switch, which can connect to a TV or be played on the go, were boosted by the popularity of games such as Animal Crossing: New Horizons as a COVID-19 pandemic lockdown pastime.
The Japanese company forecasts it would shift 15 million Switch 2 consoles in the financial year, about equal to the original in the same period after its release.
The new device costs US$449.99 in the US, more than one-third more than the Switch. A Japan-only version is cheaper, at ￥49,980 (US$346.41).
New Switch 2 games such as Donkey Kong Bonanza and Mario Kart World — which allows players to go exploring off-grid — are also more expensive than existing Switch titles.
Most original Switch games can be played on the Switch 2, and some Switch blockbusters such as The Legend of Zelda: Breath of the Wild are to have enhanced editions released for the new incarnation.
“People were a bit shocked by the price of Mario Kart World, the first US$80 game that we’ve ever seen,” said Krysta Yang of the Nintendo-focused Kit & Krysta podcast.
While the company is “going to have to do some work” to convince more casual gamers that it is worth upgrading, Nintendo fans are “super excited,” she said.
The Switch 2 is to have eight times the memory of the first Switch, and its controllers, which attach with magnets, can also be used like a desktop computer mouse.
Although the new console is not radically different, “a lot of people [are] saying: ‘This is what I wanted, I wanted a more powerful Switch — don’t mess with a good thing,’” said Yang, a former Nintendo employee.
New functions allowing users to chat as they play online and temporarily share games with friends could also be a big draw, MST Financial Services Pty Ltd senior research analyst David Gibson said.
“It’s a way to appeal to an audience which has got used much more to the idea of streaming games and watching games, as well as playing games,” he said, predicting that the Switch 2 would break records in terms of early sales.
Success is crucial for Nintendo.
While the Super Mario maker is diversifying into theme parks and hit movies, about 90 percent of its revenue still comes from the console business, analysts said.
Nintendo delayed pre-orders for the Switch 2 in the US by two weeks as it assessed the effects of US President Donald Trump’s global assault on free trade.
Its pre-orders have since sold out in the US market and elsewhere, with the company boasting of particularly high demand in Japan.
Furukawa last month said that Nintendo’s financial projections are based on the assumption of US tariffs of 10 percent on products produced in Japan, Vietnam and Cambodia, and 145 percent on China.
“Hardware for North America is mainly produced in Vietnam,” he added.
Trump’s hefty so-called “reciprocal” tariff of 46 percent on goods from Vietnam is on pause, while those on China have been slashed.
Tariff uncertainty could push consumers to buy a Switch 2 sooner, because they are worried that the price could go up, Yang said.
Charlotte Massicault, director of multimedia and gaming at the French retail giant Fnac Darty, said that pre-sale demand has been “well above what we imagined.”
“For us, this will be a record in terms of first-day sales for a games console,” she said.
The new Switch is “less of a family-focused product, and more of a ‘gamer’ product” compared with the Switch, she said.
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