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Nintendo Stock at Risk Despite Switch 2 Success
30 Jan
Summary
- Switch 2 sales strong, but memory chip prices are rising.
- AI hardware demand is driving up memory chip costs.
- Investor fears grow over Nintendo's stock due to price hikes.
Nintendo Co.'s stock may face pressure from investors despite the anticipated success of its Switch 2 console. The company is expected to report strong third-quarter revenue, buoyed by recent data indicating impressive holiday sales in the US, which could make the Switch 2 the fastest-selling console ever.
However, a significant challenge looms: a worldwide crunch in memory chip supply. This shortage, driven by the escalating demand for AI hardware, is projected to drive up the manufacturing costs of the Switch 2. Consequently, the increased console price poses a risk to Nintendo's stock performance and its ongoing recovery.
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