The Switch 2 is launching in early June amid ongoing drama and uncertainty about tariffs, and now Nintendo has put a greenback quantity to how a lot of a unfavourable influence it is forecasting consequently.
Chatting with analysts and buyers as a part of the company’s latest earnings briefing, Nintendo president Shuntaro Furukawa stated Nintendo has factored in a unfavourable influence of “a number of tens of billions of yen on the revenue stage.” Ten billion yen equals about $67 million, so it is not a small quantity.
Furukawa stated Nintendo is basing this off the US tariff charges efficient April 10. It is now mid-Could, and issues have developed since then. Only recently, the US and China reached an agreement that sees the US drop its earlier 145% tariff fee on China all the way down to 30%, with China decreasing its fee on the US from 125% to 10%. This deal is ready to final for 90 days, which might take it past the Switch 2 launch date.
Given Nintendo’s forecast was based mostly on what the tariff fee was on April 10, there is likely to be completely different calculations happening at Nintendo now that tariffs on items from China have been lowered massively. This has been a fluid state of affairs for Nintendo and lots of different firms bringing in items to the US from China (Switch 2 consoles are manufactured in China, Vietnam, and Cambodia).
Furukawa made these feedback throughout Nintendo’s newest earnings briefing on Could 8, and the English translation was not posted till in the present day, Could 13. The US and China introduced their joint commerce deal on Could 12.
Furukawa went on to say that the Switch 2 is anticipated to have a decrease revenue margin that the unique Switch, which has been on sale since 2017.
“Our primary coverage is that for any nation or area, if tariffs are imposed, we acknowledge them as part of the fee and incorporate them into the value. Nonetheless, this 12 months marks our first new devoted online game system launch in eight years, so given our distinctive state of affairs, our precedence is to keep up the momentum of our platforms, which is extraordinarily necessary for our devoted online game platform enterprise, and to quickly develop the set up base of our new {hardware},” Furukawa stated.
The manager added that if there are additional adjustments to tariff insurance policies for China and different markets, Nintendo would contemplate “what sort of worth changes could be acceptable,” if any.
For context, Nintendo is projecting 320 billion yen in working revenue and 380 billion yen in extraordinary revenue for the fiscal 12 months ending March 31, 2026, together with 300 billion yen in revenue attributable to homeowners of mother or father.
For the fiscal year that ended March 31, 2024, Nintendo made an working revenue of 528.9 billion yen, an extraordinary revenue of 680.5 billion yen, and 490.6 billion yen in revenue attributable to homeowners of mother or father. For the fiscal year that ended March 31, 2025, Nintendo made an working revenue of 282.5 billion yen, an extraordinary revenue of 372.3 billion yen, and 278.8 billion in revenue attributable to homeowners of mother or father.
Nintendo is anticipating to promote 15 million Switch 2 models through the present fiscal 12 months that ends March 31, 2026, and that is about the identical as the unique Switch over its first 10 months out there. Furukawa stated the Switch 2’s “comparatively excessive” worth in comparison with the unique Switch–it’s $50 dearer with inflation factored in–represents one of many “challenges to early adoption” of the system.
“The boundaries of our {hardware} manufacturing capability weren’t a consider setting our gross sales quantity forecast. Moreover, the tariff state of affairs within the U.S. or a risk of a recession didn’t have an effect on our gross sales quantity forecast both,” Furukawa stated.
Nintendo held its large Switch 2 Direct on April 2, the identical day that US President Donald Trump introduced his “Liberation Day” tariffs on China. Responding to this, Nintendo introduced that Switch 2 preorders wouldn’t start on April 9, however had been as an alternative delayed to later within the month, with many questioning if Nintendo would elevate the value of the console consequently. That didn’t occur, however the firm did elevate costs on some Switch 2 equipment.