Mario alone can’t plug Nintendo’s leaking stock

Nintendo

19/05/2026 04:00

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Hudson Lockett

HONG KONG, May 19 (Reuters Breakingviews) - Nintendo 7974.T has a problem: Mario is missing. More than eight years after his last big 3D adventure, one year after the Switch 2’s launch and on the heels of the superpowered plumber's second movie, the Kyoto-based games maker has yet to unveil his next adventure. The lack of such a so-called system seller helps explain why shares are down more than 30% this year. The bigger issue may be the company’s perpetually gloomy earnings guidance.

Nintendo dented enthusiasm by raising the price of its sequel console by $50 to $500 this month. There's good reason for it, at least, with tariffs and higher memory chip costs adding $629 million to expenses. But it also forecast selling just 16.5 million units this fiscal year, a 17% drop.

Seasoned observers know the company run by Shuntaro Furukawa tends to lowball such numbers; Morningstar reckons console and game shipments will be 15% and 24% above Nintendo’s guidance. Such negativity can imply that Nintendo lacks faith in its products, just as the Switch 2 enters its vital second year lacking a breakout title to motivate long-time fans to upgrade their console.

It's not the first time its conservatism has backfired. Only after months of strong Switch 2 sales last year did Nintendo raise its forecast for the year from 15 million to 19 million units. Traders then pushed the stock up to a near-record high in November before getting run off the road by mounting chip costs, tariffs and silence about upcoming releases from top-tier franchises like Mario and The Legend of Zelda.

Next month's Nintendo Direct event may at least provide some answers about the timing of new games. Jefferies analyst Atul Goyal reckons the company will release a blockbuster—known as triple-A in gaming lingo—Mario adventure this year, though he admits he's an outlier. It would be odd to start selling such an important product right after cutting guidance.

Chances are the next reveal will adopt the playbook of the company's last triple-A entry in the franchise, Mario Odyssey. It went on sale roughly a year after first being teased in October 2016. This time round, that'll let gamers marinate in anticipation for up to 12 months as they scrounge together the cash to buy the now more expensive Switch 2. Trouble is, that also risks Nintendo forcing shareholders to continue playing its shoddy forecasting game on an endless loop.

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CONTEXT NEWS

Shares in Nintendo have fallen more than 30% this year and are down more than 3% since the games maker announced a $50 price hike for its Switch 2 console on May 11, citing increased costs from rising memory chip prices and tariffs. The company also forecast sales of 16.5 million units for the current fiscal year ending in March 2027, down from almost 20 million consoles sold in the previous 12 months.

The Kyoto-based firm is expected to hold a “Nintendo Direct” live event in June to spotlight upcoming releases. In a May 8 note, Jefferies analyst Atul Goyal wrote that the June event would be a “key near-term signpost” for Nintendo and that the second year for the Switch 2, which launched in June 2025, “is crucial and our non-consensus view is that it will release a Mario AAA game this year”.

Nintendo's share price has halved since November https://www.reuters.com/graphics/BRV-BRV/lbvgyebebvq/chart.png

(Editing by Antony Currie; Production by Ujjaini Dutta)

((For previous columns by the author, Reuters customers can click on LOCKETT/ hudson.lockett@thomsonreuters.com))