Are Switch 2 consoles pofitable in Japan?

[Sephiran]

haxxiy said:

Phenomajp13 said:

Im not an Economist so someone with real knowledge please correct me but I don't think you can just compare the value of currency like that. Im assuming you are referring to how the price of Switch 2 is cheaper in dollars (around $350.00 in USD I think?) than what is charged here in the US ($450)? It's more about about the "purchasing power?" of your currency in your country. The price of the Switch 2 in Japan went up 50% compared to Switch like in the US. In the US, the Switch was $299.99 and went up 50% for Switch 2 of $449.99. So I'm not sure if Switch 2 is "cheaper" in Japan than other regions.

International contracts are usually signed and paid in dollars, so yes, it is cheaper in Japan (and thus making less money) by a significant ammount due to the weaker Yen.

AFAIK their BOM was $350 for the Switch 2, and while you can put any number there with some creative accounting (usually to undervalue the product for tax reasons), that does give some rough idea that the Japan-only model is selling at a loss.

Another example is that the PS5 at launch in Japan cost around the same as Switch 2 cost now, but the yen weakening made them do a pretty steep price hike to offset the weakening yen. The fact that Nintendo didn't do that means that they are eating the cost of the weak yen which means its probably sold at a loss.