Nintendo president Shuntaro Furukawa said the supply of the company's Nintendo Switch 2 game console has been stabilizing globally, though Japan continues to trail other markets, as rising memory costs linked to artificial intelligence demand add pressure to hardware margins.
The Switch 2, launched on June 5, 2025, has remained in short supply in Japan since its release, with many retailers and online stores initially relying on lottery-style sales because of limited availability, according to an interview published on January 9, 2026, by the Kyoto Shimbun.
Furukawa said Nintendo entered the launch with a stronger supply setup than it had for the original Switch, but still made the system difficult to purchase in some regions. He said the global supply situation has become more stable and that "Japan is the only one that is a little behind," adding that the effects of production measures taken for the 2025 year-end shopping season should gradually appear. Nintendo plans to respond flexibly to demand, he said.
Retail availability improves unevenly
On July 2, 2025, Furukawa said during Nintendo's 85th annual general meeting question-and-answer session that while many stores initially relied on lotteries, the company had recognized that some retailers were beginning to offer in-store sales.
In an online press briefing on November 4, 2025, he said Nintendo wanted to enable each customer to purchase the device and aimed to exceed its current sales plan. He added that overseas markets had become more able to sell at retail, while Japan was improving but had not yet reached a point where consumers could buy at any time.
Rising memory costs add pressure
Cost pressures remain a key concern. A December 11, 2025, report by the Nikkei said the price of a 12-gigabyte RAM module used in the Switch 2 rose 41% during the fiscal year, while NAND storage prices increased about 8%. The report said higher component costs have weighed on the console's profitability and contributed to a roughly 20% decline in Nintendo's share price.
The broader rise in memory prices has been driven by expanding AI demand and an acceleration in data center construction, which has boosted demand for high-bandwidth memory. Samsung Electronics, SK hynix and Micron Technology, which together account for about 90% of global memory semiconductor supply, have begun shifting production resources from general-purpose RAM to higher-margin high-bandwidth memory. US semiconductor export restrictions on China have also intensified supply-demand tightness.
Pricing pressure builds
MS Hwang, a research director at Counterpoint Research, said fears of tight supply and speculative demand are driving memory prices higher in a "snowball" effect. He said expanding production capacity takes significant time, making near-term output increases difficult and leaving market stabilization likely to be gradual.
Recent price increases by Sony and Microsoft following the launch of new console generations highlight the pricing pressure facing hardware makers as component costs rise. Against that backdrop, Nintendo could eventually face a trade-off between absorbing higher costs to preserve its current price point or raising prices at the risk of softer demand, though the timing and outcome of such decisions remain uncertain.
Furukawa said components are procured from suppliers based on Nintendo's medium- to long-term business plan and that the current memory price environment does not have an immediate impact on financial performance. He said the company must "monitor the situation closely," declining to comment on hypotheticals related to a potential price increase for the Switch 2.
Article edited by Jerry Chen
