Since announcing earlier this month the release details for the Switch 2, Nintendo has had to face several headwinds, including negative reactions to the high price of the console and game titles in the US and Europe ($450/ EUR450 and $70-90, respectively) that cast some doubts about consumer demand, the tariff drama that could have sparked a price hike for consoles shipped to the US and a darkening economic outlook.
While Nintendo delayed by two weeks the Switch 2 preorders window in the US to review the tariff situation, it finally decided to leave the console price unchanged, only raising the price of accessories.
Preorders are then now live in the three key geographies (US, Europe and Japan) and are impressive, to say the least. In Japan, Nintendo announced it has received 2.2mn preorders, far exceeding its own expectations and available supply, leading the company to move some orders to another date and to put users into a lottery to order the console after the June 5 launch.
In the US, the Switch 2 is sold out at most retailers and in Europe, preorders have hit record levels according to local retailers, pointing to a shortage of consoles in the first months after launch.
Overall, it seems that a large number of Switch users (close to 150 million installed base) are keen to transition quickly to the Switch 2 despite its high price, suggesting that demand for video games in a new console cycle will remain strong even assuming macro headwinds.
Importantly, new console cycles historically spark a spending pickup on video games as consumers tend to buy numerous games early in the cycle to enjoy and test the capabilities of their new machine and as publishers release numerous blockbusters to capitalize on the opportunity.
The Switch 2 could then reinvigorate video game software demand in coming quarters, with Japanese publishers in pole position to benefit as their exposure to Nintendo consoles is on average higher than their US and EU rivals.
