Nintendo Switch 2 Price Concerns as RAM Costs Rise

Nintendo stock declines as hardware costs rise and memory prices surge across the global gaming industry.

Hardware by Shinji Okazaki on Jan 20, 2026

There hasn't been much good news about the video gaming industry as a whole, and Nintendo is now a part of that conversation. Switch2 was selling well until November, but now investors are worried. In August 2025, Nintendo's stock in Japan hit an all-time high of 14,795 yen. By the end of the year, it had dropped to 9,950 yen, a 33% drop in five months.

Investors are worried about the possibility of higher hardware prices, a small selection of first-party games, and the fact that hardware prices are lower around the holidays. Sales of hardware also fell sharply in November, further heightening their concern about long-term demand.

Nintendo Switch 2, Price Concerns, as RAM Costs Rise, NoobFeed

Hardware Costs are Rising, and Sales are Declining

In November 2019, the average price for new video game gear was $235. By November 2025, it had gone up to $439. During the same period, hardware unit sales fell from 3.9 million to 1.6 million. Prices are rising, and sales are falling, which means people are spending more but buying fewer consoles.

Even in the past, when the value of money was lower, more units were sold. The existing plan to raise costs without strengthening the ecosystem is holding back growth.

The Performance of Stocks in the Whole Industry

In late 2025, many corporations' stocks did quite well. Unity went up 80%, TakeTwo went up over 40%, Roblox went up 37.7%, CDProjektRed went up 24.6%, Ubisoft went up 49.9%, and Sony also saw gains. By December 30, 2025, Nintendo had gone up 16%.

But at the start of the new year, Nintendo's stock value fell sharply by 33%. The main worry is that hardware prices might go up, and there won't be a big hit game coming out in 2026.

Problems With the Software Lineup and Making Money

Nintendo's 2026 portfolio includes games like Mario Tennis, Fire Emblem, Yoshi's Pokedex, Super Smash Bros. Ultimate, and new versions of Animal Crossing: New Horizons.

The cost of making things keeps rising because it takes more resources to produce new tools. The first Switch was popular for a long time because it was fun to play and didn't require major updates. Switch 2 runs faster and has games available only on that model. Some new games can still be played on the original Switch.

Players who are on a tight budget don't have to upgrade. High hardware prices inevitably lead to low profit margins.

Rising Memory Prices and Demand for AI

The rising cost of memory chips is the major worry. The number of AI data centers has increased significantly, reducing supply and raising prices. This affects both PCs and consoles.

Nintendo executives said that they are keeping a close eye on the state of the memory market. Switch2's profit margins are already lower than those of the first Switch. Hardware profitability depends on the cost of parts, production volume, exchange rates, and tariffs.

Nintendo has previously hoarded parts to keep production costs down, but the price of RAM keeps going up. The situation remains unstable, even though it doesn't affect wages immediately.

Pricing Strategy and Tariffs

Nintendo expected tariffs to hurt its business at the start of the fiscal year, costing it tens of billions of yen. During the first half of the year, these costs hurt profits.

The company's approach is to treat tariffs as a cost and, when possible, add them to hardware pricing. Nintendo is also aiming to keep the momentum going on its platforms and get people to buy new devices. It is still hard to balance these goals.

Sales Throughout the Holidays Were Low

Only about 1.8 million to 1.9 million hardware units were sold during the holiday season for all console makers. People think this is a bad performance for such an important time of year for sales.

This means Nintendo will have to change its pricing strategy more quickly, and people will buy new hardware more slowly.

Growing More than Games

Nintendo wants to turn its intellectual properties into movies and cartoons. The idea is to get more people to know about the characters, not to make money quickly.

Nintendo wants to bring more people into its ecosystem by using movies and animation projects to attract people who don't play video games.

Long-Term Strategy and Future Software

Starting in 2026, Nintendo plans to add more popular franchises and fresh original games to its software lineup. The goal of these enterprises is to keep people interested over the long term, not to make money right away.

The company is working on major releases that fans are looking forward to, and it's also experimenting with fresh creative ideas.

Nintendo Switch 2, Price Concerns, as RAM Costs Rise, NoobFeed

Cost Pressure Across the Board

Even Nintendo, typically seen as an industry anomaly, is feeling the effects of higher prices. All hardware makers are being affected by rising prices for RAM, storage, GPUs, and other parts.

It's harder to launch or tease new hardware because of uncertainty about component prices and global supply conditions.

Final Thoughts

The video game business is going to have a rough year. The company is having a hard time with finances because hardware costs are rising, demand is unclear, memory prices are rising due to AI, and tariffs are also rising.

Nintendo is not the only company having problems; it is part of a broader trend in the business world. Hardware costs may go up, and businesses may not make much money. To keep customers excited, new software updates will be very important. The way things are now shows that even well-known businesses need to change with the times and deal with long-term cost issues.

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