Nintendo's share price dropped 10% on May 11 — its steepest single-day decline in three months — after the company projected it would sell only 16.5 million Switch 2 consoles in fiscal year 2027, down sharply from the 19.86 million units sold in fiscal year 2026. While 16.5 million is still a substantial number that would outpace the original Switch's performance over its first 22 months, the trajectory spooked investors who had grown accustomed to the console's record-breaking early momentum. The decline compounds an already uncomfortable trend: Switch 2 sales fell behind the PS5 in the first two months of 2026, and Nintendo is now signaling that relative softness will continue through the year. Nintendo's stock is now sitting at its lowest point since August 2024, when a broader gaming industry selloff hit Nintendo, Sega, and Capcom simultaneously as console sales slowed and macroeconomic pressure built across industries.

The sales projection is not the only concern weighing on investors. Nintendo President Shuntaro Furukawa acknowledged when announcing the Switch 2's $50 global price increase that the hike does not fully cover rising production costs — meaning the RAM shortage and broader supply chain pressures are actively compressing margins at the same time unit sales are expected to decline. That combination of lower volume and thinner profit per console is a difficult story to tell investors, particularly after the Switch 2 launched to record demand. Nintendo did recover from the August 2024 rut to reach all-time highs following the Switch 2 launch, but that tailwind has now been spent, and the company's software lineup will need to carry significant weight to restore investor confidence from here.