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Despite repeated predictions that the rise of mobile platforms, cloud gaming and high-performance PCs will discontinue consoles, Nintendo has proven that hardware is still important. The record-breaking debut of Switch 2 reset the story.
Nintendo had a goal of selling 15 million new consoles by March next year. However, in just four days, the Japanese gaming company sold over 3.5 million units of the $450 Switch 2. This is the most powerful launch on record. This momentum is notable in hybrid consoles that double as handheld and home devices, especially as the industry shifts towards digital distribution and subscription services.
Early sales restructure Nintendo’s fiscal year outlook. Game hardware and software titles make up a large part of the group’s revenue. According to LSEG, Switch 2 will cost more than its predecessor, but analysts expect revenues of 210 million ($14.5 billion) this year.
However, supply presents immediate constraints. Strong early demand has already led to shortages, with some markets experiencing limited availability at launch. In response, Nintendo asked its manufacturing partners to accelerate production in the coming months. Switch 2 suppliers include artificial intelligence chip manufacturer Nvidia.
The original Switch’s runaway success also intensified competition and sparked a new wave of handheld challengers. Devices like Steam Deck, Rog Ally, and Legion Go are targeted to the same users. Nintendo’s most direct rival, Sony, is also reportedly preparing a new portable PlayStation device.
In addition to these pressures there are geopolitical risks, particularly those surrounding international trade policy. Nintendo delayed pre-orders for Switch 2 from April to June to assess President Donald Trump’s tariffs. The broader threat remains unresolved. Given that it is already priced at a premium compared to its product predecessors, the extra costs shifting towards consumers can slow down momentum.
However, Nintendo’s strength is not in its cost competitiveness. Despite rival devices offering attractive hardware alternatives, there are no exclusive Nintendo franchises such as Mario, Zelda, and Pokemon. Backward compatibility with previous Switch titles allows users to access the instant game library from day one, reducing the burden on gamers that may arise when new hardware launches.
Most importantly, Nintendo’s biggest edge is generational familiarity. For many, the product serves as the first introduction to the game. That connection allowed Nintendo to remain relevant even if the industry circumvents it. In a market once defined by short product cycles and changing consumer preferences, Nintendo is redefineing what a successful gaming strategy looks like in a fragmented, cross-platform landscape.
june.yoon@ft.com
