Nintendo’s stock has been climbing in recent weeks, reaching levels not seen in seven years, as traders and fans alike await the unveiling of Switch 2. Investors are excited over what Nintendo may deliver at its presentation on Wednesday, April 2, at 9 a.m. ET. 

The upcoming event Nintendo Direct event is expected to reveal crucial details such as pricing, features, game lineup, and a possible release date. 

The stakes for this reveal are significant. In the past 12 months, Nintendo shares have risen about 25%, a performance that stands out even amid the broader gains of Japan’s Topix benchmark. The share-price increase briefly pushed the company’s market capitalization above $100 billion.

The ongoing tariff policies of the Trump administration have driven up costs for goods produced in certain regions, prompting worries that the Switch 2 might end up priced higher than some want to pay. UK-based Japan equity analyst Pelham Smithers warns that a hefty price tag could dampen consumer enthusiasm. “If it’s going to come at $449 or $499, as many are predicting, that’s very high—and that’s before tariff talk,” he said. 

The device’s final price could heavily influence how it performs in the marketplace, especially in North America, where the cost of console gaming is already under scrutiny.

There is also the matter of short interest and how it reflects overall market sentiment. Data from S&P Global show that short interest in Nintendo’s stock recently spiked above 1.8% of the free float, near the highest level in about a year. 

Some analysts believe that if the details on Wednesday do not exceed what the market hopes for, the share price could correct itself. Smithers noted, “I think the run that Nintendo has had over the past year probably sums up the upside.” In other words, if the Switch 2’s reveal is merely acceptable and not exceptional, the stock might give up some of its gains.

Nintendo’s price-to-earnings ratio has been another point of interest. The company’s stock has been trading at about 30 times the estimated forward earnings for the past two months, a level that was last seen in early 2018. This valuation is higher than those of console peers such as Sony Group Corp. and Microsoft Corp., which some believe could magnify any market shock if the Switch 2’s features disappoint. 

Nonetheless, many on the sell side remain positive, with 21 buy recommendations, eight holds, and three sells among analysts. Supporters say the console can help revive Nintendo’s sales growth, which has tapered off in the later years of the original Switch.

Looking at history, it is worth remembering that stock enthusiasm around Nintendo hardware announcements can lead to short-term dips if the market perceives the details as underwhelming. When the original Switch was fully unveiled in January 2017, the company’s shares fell about 6% over the following week. 

Robin Zhu, an analyst at Sanford C. Bernstein, believes a drop of that scale—if not bigger—could happen this time because Nintendo’s shares have reached a much higher price than in 2017. “It shouldn’t be a surprise if there’s a round of profit-taking” after the Switch 2 announcement, he said. According to Zhu, losses will “probably be bigger than the hardware unveiling last time,” due to the stock’s steep run-up in the lead-up to this new console.

Wednesday Nintendo Direct will reveal details about Switch 2

Back in January, the company released a short teaser video for the Switch 2 that didn’t reveal much. It did, however, confirm the existence of a new Mario Kart game. The teaser also hinted that the Joy-Con controllers might be receiving upgrades, including a new “C” button whose function remains a mystery. Some patent filings suggest Nintendo may allow users to operate a controller in a way that mimics a computer mouse, but that is yet to be confirmed.

During Wednesday’s Nintendo Direct, most industry watchers expect specifics on both hardware and software. The console’s performance relative to other systems is a subject of much speculation. Some believe it could match or even exceed the graphics power of a PlayStation 4 Pro. Others suggest it may resemble the power found in a popular handheld PC Steam Deck. 

Whatever the case, there are rumors that the Switch 2 might leverage DLSS upscaling for 4K resolution when the console is docked and connected to a television. If true, this would be a major advancement from the original Switch, which maxes out at 1080p when docked.

The question of third-party game compatibility is another top focus. Smithers said the ability to play big-budget titles not available on the original Switch—like those commonly seen on Sony’s PlayStation or Microsoft’s Xbox—would broaden the Switch 2’s appeal. The more games people can play on Nintendo’s new device, the more it can compete for a share of the console market. 

Reports from Insider Gaming indicate that June might be the launch window, which lines up with Nintendo’s pattern of releasing new hardware right before or during the summer months. Still, we are only certain that the console is expected sometime after April 2. 

It is also possible that Nintendo will delay the launch if the supply chain or tariff situation complicates manufacturing and distribution.

The cost of the console is the biggest question. A Bloomberg report that circulated recently pointed to a minimum of $400, and many watchers think $449 or even $499 might be more realistic. The final number will likely be influenced by global economic conditions, as well as whatever negotiations Nintendo has had with manufacturing partners. Nonetheless, whether the company aims for a low price to maximize adoption or sets a higher figure to protect profit margins remains to be seen.

In terms of software, Nintendo fans have come to expect well-timed franchise entries. Mario, Pokémon, and Zelda have consistently boosted hardware sales over the years, as each new release encourages longtime players and newcomers alike to pick up the latest device. If the Switch 2 has multiple first-party games at launch or near launch, that will work in Nintendo’s favor. 

Besides the games, observers hope to see a refined operating system for the console, including potentially improved online features. Nintendo has historically lagged behind other console makers in the online arena, but the company has made strides through Nintendo Switch Online. 

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