Nintendo Cuts Switch 2 Production by One-Third After Weak Holiday Sales

Nintendo cut production of the Switch 2 after demand for the $450 console trailed the company's expectations during the year-end holiday season, particularly in the United States. The company plans to make 4 million units of the device this quarter, a third less than the 6 million it had originally planned to produce, with the reduced output rate set to continue in April.

The Bloomberg report, attributed to people familiar with the matter who asked not to be named, landed on March 23 and sent an immediate signal to markets. After a record-setting debut in June, sales of the Switch 2 failed to meet Nintendo management's high expectations, with Japan remaining a stronghold while the U.S. did not see similar continued success.

Nintendo president Shuntaro Furukawa had flagged the regional divergence at a shareholder meeting in February. "Domestic hardware sales volume exceeded our expectations, while overseas sales were slightly weaker than our expectations," Furukawa told shareholders, a remark that video games market analysts had also previously discussed. In Japan, Switch 2 ownership was driven by demand for titles such as Pokémon Legends: Z-A Nintendo Switch 2 Edition and the Switch 2 exclusive Kirby Air Riders. Internationally, momentum slowed due to the absence of a must-have Nintendo game comparable to a Mario or Zelda blockbuster, a gap that Metroid Prime 4: Beyond was never expected to fill on the same scale.

Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors, called the shortfall "awful news," adding: "Clearly the software lineup has been poor, at least until most recently with Pokemon showing some hope."

That Pokémon lift, however, did not change Nintendo's calculus. The successful launch of Pokémon Pokopia did not prompt management to accelerate Switch 2 production. Instead, Nintendo said it is waiting to see whether the game and other new titles have enough staying power to merit an output increase.

The production revision carries a cost on the Tokyo exchange. Nintendo shares fell 2% after the Bloomberg report, lagging a 0.5% rise in the Nikkei 225 index.

Despite the cut, the console's overall trajectory remains notable. The Switch 2 had sold 17.37 million units as of December 31, 2025, making it the fastest-selling console in Nintendo history. Nintendo's most recent forecast estimated the company will sell 19 million Switch 2 consoles by the end of the current fiscal year on March 31, 2026, and Bloomberg's sources indicated the production cuts are not expected to derail that target.

Pressure on the hardware extends beyond demand. Skyrocketing RAM and storage chip prices are posing a challenge for every manufacturer, and Nintendo is reportedly considering increasing the Switch 2's $450 price, though Bloomberg's sources specified those rising memory costs are not the driver behind the current output reduction. The production cuts are strictly a response to consumer demand falling short of internal projections.

All eyes will now be on Nintendo to shore up its lineup of Switch 2 games for the rest of 2026, with fans hoping for a new 3D Mario platformer in time for the next holiday season. For developers inside Nintendo's studios, the production signal carries an unmistakable message: the window to deliver a system-defining exclusive has not closed, but it is narrowing.