Nintendo beats Q1 estimates despite Switch 2 sales falling 34%

Nintendo reported on August 6, 2026 that its fiscal first-quarter profit and revenue exceeded analysts' forecasts, even as sales of its Switch 2 console tumbled.

Net sales reached 2.05 trillion yen, matching the company's full-year forecast for the period ending March 2027. Shares closed 2.87% higher on the day of the announcement, signaling investor confidence despite the hardware slump.

Switch 2 hardware sales fell 34.4% from a year earlier to 3.82 million units, and original Switch sales dropped 31.8% to 0.66 million units. Nintendo attributed the decline to a tough comparison with the prior-year period but said consumer adoption of the new console continued, aided by fresh game releases.

Software sales were driven by Tomodachi Life: Living the Dream, which sold 7.94 million units, and Pokémon Pokopia, with 1.27 million units. The company stressed that releasing new titles at regular intervals is crucial to expanding the Switch 2's installed base.

Nintendo factored nearly 100 billion yen in higher component costs, particularly for memory, and tariffs into its cost of sales. The Switch 2, launched in June 2025, relies on memory chips whose prices have surged amid brisk AI demand.

In Japan, where Nintendo raised Switch 2 prices on May 25, 2026, hardware sell-through remained solid. The company also announced a $50 price increase in the United States, bringing the console's retail price to $499.99 from $449.99 effective September 1, 2026.

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