Nintendo Delays Switch 2 Preorders Amid Tariff Concerns

Nintendo's decision to delay preorders for the Switch 2, now set to launch on June 5, 2025, highlights the uncertainties surrounding Trump's new tariffs. The gaming giant assesses the market impact as it navigates supply chain challenges.

Date: 05-04-2025

AI Rating: 5

Tariff Implications on Nintendo
Nintendo's delay of preorder dates for the Switch 2 console due to newly imposed tariffs carries significant implications for its market strategy and financial performance. With the original preorder start being pushed back from April 9, the company is displaying caution as it evaluates the potential impact of these tariffs on its costs and pricing strategy.

The tariffs announced entail a 10 percent blanket tax on imports, and notably high rates for products coming from Japan (24 percent) and Vietnam (46 percent) where Nintendo has strategic manufacturing operations. This could heavily affect the pricing structure for the Switch 2, retailing at $449.99. If manufacturing costs rise due to tariffs, Nintendo may need to pass these costs to consumers, thus affecting demand and revenue growth.

The current situation creates uncertainty in the market. The Switch 2 is expected to launch on June 5, 2025, and despite its enhancements over its predecessor, the escalating costs could dampen consumer enthusiasm, especially given the already high game prices reaching $79.99. Such a scenario could negatively affect Nintendo’s expected earnings per share (EPS) and profit margins if sales do not meet expectations due to price sensitivity.

Moreover, the gaming market’s reaction has been negative, with overall U.S. markets witnessing declines. This sentiment may present short-term volatility affecting Nintendo’s stock, especially as it navigates both supply chain issues and changing market conditions. Investors should watch closely for recalibrated financial projections based on the assessment of tariff impacts, revenue forecasts, and profit margin resilience.

Stocks: NTDOY