Neilson Barnard/Getty Images for Nintendo of America
Nintendo's ADR shares dropped 5% on Tuesday after a report said its next-generation console will be delayed until next year.
Bloomberg reported on Saturday that Nintendo has told game publishers that the Switch 2 console could be delayed until March 2025 at the earliest, citing people with knowledge of the matter.
Previous reports had suggested that the successor to the wildly popular Switch would be released in 2024, prior to the holiday season. A delayed launch until 2025 would miss the crucial holiday sales season and put more pressure on Nintendo to sustain sales of its seven-year old Switch console.
"New hardware is a key focus point of the market, and Nintendo did not provide any particular updates during the results briefing," JPMorgan said in a note following the company's earnings earlier this month.
The Nintendo Switch was first released in 2017 and has sold nearly 140 million units, making it the third best-selling video game console of all time, behind the Playstation 2 and Nintendo DS.
Nintendo has relied on blockbuster software releases to drive further sales of its console, including hits from the Mario and Zelda franchises. The company's release of the Super Mario Bros. Movie last year also helped juice consumer excitement for the company's products.
"With Nintendo Switch entering its eighth year, expanding hardware sales volume further is difficult. However, hardware operations remained at a high level during the year-end sales season, due partly to the acquisition of new users, and given plans for the release of many new titles in 2024, Nintendo aims to maintain momentum in the Nintendo Switch business," JPMorgan said.
Despite Tuesday's sell-off, Nintendo stock is still trading near multi-year highs, hitting levels not seen since late 2020.
