Switch 2 Drives 99% Sales Surge to ¥1.9T; Stock 40% Off Highs
Net sales rose 99.3% year-over-year to ¥1.9 trillion in the first nine months of fiscal 2026, driven by 17.37 million Switch 2 units sold through December 2025. A 40% drop from record highs and declining memory chip prices have fueled “earnings supercycle” optimism and rendered Nintendo’s valuation compelling.
1. Robust Sales Growth
Nintendo’s net sales rose 99.3% year-over-year to ¥1.9 trillion for the first nine months of fiscal 2026, propelled by 17.37 million Switch 2 units sold through December 2025 and a 67.7% quarterly sales increase during its launch period.
2. Stock Performance and Valuation
Following a sell-off exceeding 40% from its all-time high, Nintendo’s market valuation has reverted to levels last seen several years ago, prompting analysts to flag the stock as attractively priced based on forward earnings multiples.
3. Earnings Supercycle Potential
Declining memory chip prices have eased production costs for the advanced Switch 2 hardware, laying the groundwork for an “earnings supercycle” that could meaningfully expand gross margins as input expenses continue to fall.
4. Strategic Outlook and Risks
Investors highlight Nintendo’s iconic IP portfolio, strong balance sheet and expansion into films and entertainment as growth drivers, while cautioning that hardware market volatility and mixed reception of new movie releases could introduce headwinds.