In Japan, the Nintendo Switch 2 launched with two distinct SKUs, one being a cheaper, Japanese-language only model sold at retail (for about $330 USD), and a non-region locked multi-language model sold through the My Nintendo Store (priced at about $450). According to Toyo Securities analyst Hideki Yasuda, the affordable SKU, which is the popular choice among Japanese consumers, is generating a significant loss for Nintendo, estimated at about 25,000 yen or $160 USD per unit.
Writing for Diamond Online, Yasuda analyzed Nintendo’s recently published financial results for the third quarter of the fiscal year ending March 2026. The company reported year-on-year growth in revenue and operating profit by 99.3% and 21.3% respectively, but Yasuda notes that the profit margin is lagging when compared to sales. He speculates that the reason for this is the Switch 2’s strong domestic sales.
In Japan, the console has sold 4.78 million units since launch, and while there’s no breakdown available between the two SKUs, Yasuda speculates that sales of the Japanese-language only model are bringing down the console’s profitability, and as a result, Nintendo’s companywide profit margins.
He estimates that the Switch 2 costs around $400 to produce, which includes approximately $300 for semiconductors, such as Nvidia’s GPU and memory (the prices of which have recently surged), over $80 for the battery and casing, and other costs including manufacturing fees. Assuming Nintendo’s wholesale price to retailers is about ¥41,000, this suggests a loss of around ¥25,000 per unit (about $160 USD). Additionally, he notes that Japan’s lower attach rates (number of software units sold per hardware unit) compared to Europe and America are another factor squeezing profitability.
As a result of manufacturing costs exceeding the selling price, Nintendo is seeing a widening “negative margin” in the Japanese market, Yasuda comments, with “profitability deteriorating further with every console sold.”
While Nintendo has yet to make any official statements on whether it will be raising the Switch 2’s price, a recent Bloomberg report claims that such plans are being contemplated for 2026 (via Polygon). Analyst Hideki Yasuda certainly seems to hope this is the case, commenting that “optimizing the hardware’s price is essential.” He believes Nintendo decided to price down the Switch 2 domestically due to an underlying industry belief that expensive consoles don’t stand a chance in the domestic market. However, he criticizes this belief as outdated and debunked, expressing support for a revision in pricing or the release of custom design models to boost the Switch 2’s profitability.
Japan’s console game market grew by 138.8% in 2025, driven by the Nintendo Switch 2
This doesn’t make any sense. If the model is retailing foe $330 usd, and is losing the company $160 per unit, that would be to say the only way nintendo could break even on the unit is to raise the price by that $160 which comes to $490usd… $40 *more* than the regular sku retailing at $450… so you’re trying to tell me, in this case, that Nintendo is losing $40 per unit on all of their non-region locked units as well? Either A) Nintendo is about to go bankrupt, B) they need a new supply chain, or C) the numbers in this article are completely false.
No doubt they make up for the losses on game sales.
Nintendo has sold previous consoles at a loss, also as the other commenter said, as with previous consoles they make up the loss with games.
Also I haven’t heard the “Nintendo will go bankrupt” line in maybe a decade. I remember a stat from back then, which calculated Nintendo has banked so much money that they could lose $250 million dollars a year and still survive till around 2050. Given that was maybe a decade or more ago.. I imagine that number it is 2070 or later today.
All consoles have sold for a loss for the first few years of release and usually the cost to manufacture drops rather than increases after the first year or two making them not a loss after the 2nd or 3rd year.
The problem now is the cost of components is raising exponentially rather than decreasing
The Switch 2 manufacture in bulk cost about $200 per unit. Nintendo is definitely not losing $160 in Japan with every sale. Nintendo themselves stated that they always sell at a profit margin. With that said, just because some things increase in price ot doesn’t mean Nintendo isn’t locked on a contract that has to be honored by the manufacturer and supplier. Prices do not change from day to night. This is just another stunt for Nintendo to increase the already overpriced hanhelds price. Maybe if Nintendo focused theor money on making games instead on trying to sue everyone on planet earth, things would actually work for them. Damn fools, Nintendo died the moment Iwata died.
They are making games. There are more exclusives on the Switch 2 than the PS5 or Switch 1 during it’s 1st year.
And nostalgia blind statement like yourd loves to keep parrotting the narrative that Nintendo was customer friendly during Iwata and Reggie’s time when cease and desist were flying off Nintendo to youtubers , romsites , smash bros tournaments and fan works even during their time leading the company.