Japanese Stock Market Crumbles for Console Manufacturers and Game Companies

Pre-orders for the Nintendo Switch 2 in the United States have been delayed and no longer begin on April 9 as Nintendo tests the probable impact of tariffs by the U.S. Nintendo still aims to launch Switch 2 on its planned June 5 date, but they have not indicated when the pre-orders will begin. It will cost $449.99 in retail, with a $499.99 package providing a digital copy of Mario Kart World.

Nintendo announced the launch date and pricing details for the Nintendo Switch 2 on Wednesday, a time before the Trump Administration announced sweeping tariffs with a base rate of 10% tax on imports that go into effect April 5 and even more reciprocal ones against countries like China, Japan, and Taiwan from April 9, CBS News reports. It is not yet clear exactly how the tariffs will affect the price and launch of the Nintendo Switch 2.

Shares of Nintendo, the storied developer of Mario, Zelda, and Pokémon, dropped over 8%, which came at a very bad moment for the company. In contrast, Koei Tecmo, developer of popular series like Ninja Gaiden and Dynasty Warriors, had a 7.6% decline. Bandai Namco, developer of popular video games including Ace Combat, Dragon Ball, and the Dark Souls series, had a 7.3% decline. Another company that witnessed a decline of 7.2% was Sega, the illustrious publisher of Sonic the Hedgehog, Like A Dragon (formerly Yuzuku), and the Total War series.

On the other hand, Capcom, a developer of smash games including Street Fighter, Monster Hunter, and Resident Evil, saw a 6.6% decline. Similarly, Square Enix, a developer of legendary role-playing games like Final Fantasy, Dragon Quest, and Kingdom Hearts, had a 5.6% decline. As a last point, Konami, the company behind Metal Gear Solid and Silent Hill, saw a 5.1% decline.

While Konami's fall may not appear as steep as some of its competitors, it's important to remember that the company has been actively moving away from conventional gaming and its legendary franchises for quite some time, so they're definitely back in the game today. Japanese gaming behemoths are bearing the brunt of tariffs imposed to alter trade balances, and the markets are reflecting that. Sony's market capitalization, a major player in many entertainment industries (not alone gaming), fell by 10% in a single day. Such a massive loss can wipe out a company's value in a matter of hours, and they aren't the only ones.

Several territories and countries where Nintendo makes its hardware and physical game cards are subject to retaliatory tariffs. Japan faces a 24% tariff, China is subject to a 34% tariff, and Vietnam is being charged a high rate of 46% taxation. Nintendo, like most technology companies, has a significant portion of its production based in China. However, in recent years, Nintendo has shifted production to Vietnam for electronics and hardware manufacturing. As both countries face U.S. tariffs, it appears that Nintendo can't escape these broad tariffs.

Nintendo Switch cartridges, however, are manufactured in Japan, but packaging materials for retail Switch games could be from numerous countries, as described by Serenity Forge CEO Zhenghua Yang in a February 2025 Reddit thread. "Since the new [U.S.] presidency, we've had to quite radically alter our manufacturing pipeline," Yang claimed. "There are very real and concrete political consequences for physical publishers." That's not to say that these additional tariffs from the U.S. government will make logistics much harder for Nintendo and third parties.

Meanwhile, Nintendo Switch cartridges are manufactured in Japan, but packaging materials for physical Switch games can be imported from elsewhere, as Serenity Forge CEO Zhenghua Yang described in a February 2025 Reddit thread. "Since the new [U.S.] presidency, we've sadly already had to drastically alter our manufacturing pipeline," Yang claimed. "There are very real and material political consequences for physical publishers." That is simply to say that these additional tariffs by the U.S. government could complicate logistics for Nintendo and third-party companies.

Industry experts were already speculating that tariffs set by the Trump Administration would be detrimental to the Nintendo Switch 2 and game companies at large. Not only is Nintendo facing problems with the pricing, but the PlayStation 5's retail price has also increased to $750, so we can assume the pro version will be as high as $1350.

Unfortunately, these additional tariffs have the potential to push game and hardware prices even higher. It stands to reason that even Nintendo and other potentially vulnerable business entities themselves aren't aware of the effect this will have on their business in the short term, but whatever occurs, buyers should expect to find a huge gap in their wallets once the Nintendo Switch 2 finally emerges.