Japan's Nikkei falls as AI-related stocks decline

Overall, the market was positive, with about 60% of stocks trading higher on the Tokyo Stock Exchange's prime market.

Nintendo 7974.T rose 4.7% after the game maker said on Thursday its operating profit soared 150.5% in the April-June quarter, helped by brisk demand for Switch and Switch 2 software and refunds of U.S. tariffs.

Audio equipment and camera maker Sony Group 6758.T was up 2.7%.

Bank shares rose, with Mitsubishi UFJ Financial Group 8306.T and Sumitomo Mitsui Financial Group 8316.T up 0.39% and 0.47%, respectively.

The Topix value share index .TOPXV rose 0.26%, against a 0.35% fall for the growth stock index .TOPXG.

SoftBank Group 9984.T dropped 4.3% on Friday even after the technology investor posted a smaller-than-expected 18% drop in first-quarter profit on Thursday.

"It beat market consensus, but failed to provide cues that could lift the stock price," said Naoki Fujiwara, senior fund manager at Shinkin Asset Management.

Chip-related Advantest 6857.T and Tokyo Electron 8035.T fell 4.65% and 3.2%, respectively, while memory chip maker Kioxia 285A.T tumbled 7.5%.

"Market concerns about overvaluation of these stocks have eased, and their earnings are not bad, but investors are still not fully confident about a rebound in stock prices," said Fujiwara.

TOKYO, Aug 7 (Reuters) - Japan's Nikkei share average fell more than 1% on Friday as losses in AI and chip-related stocks outweighed broader gains, while SoftBank Group slid despite beating market expectation for first-quarter earnings.