Japanese companies Nintendo and Sony are likely to raise the prices of their game consoles due to US President Donald Trump's tariff policies, according to a Bloomberg Intelligence study.

US consumers will have to pay up to 30% more for a Switch 2 or PlayStation 5, which means about $590 for a new flagship Nintendo console or a PS5 bundle with Sony's Astro Bot. Currently, the announced price for the Switch 2, which will go on sale on June 5, is $450.

Why would the prices go up?

  • Both companies assemble their consoles in China, which is now subject to a 125% tariff on products shipped to the United States. At the same time, Nintendo has a manufacturing facility in Vietnam, which received a 90-day exemption from the increased tariffs.
  • Console makers are the most vulnerable players in the video game industry because of their need to supply physical goods, according to Bloomberg Intelligence analyst Nathan Naidoo.
  • According to him, the U.S. accounts for 29% of Sony's revenue and 37% of Nintendo's. The market is vital to both: American consumers set global trends, and over-the-air radio stimulates demand for entertainment products.
  • A 30% increase in the price of Nintendo's Switch 2 is possible if an 80-90% tariff is imposed on imports of devices into the United States. However, the company may refrain from raising prices due to a 90-day grace period, which it can use to replenish its inventory in the US.
  • If Sony or Nintendo have to raise their console prices significantly in the US, they will have to reflect these changes in global markets, Naidoo said. As for Microsoft's Xbox, it may have an easier time: the company is less dependent on manufacturing partners subject to higher US duties.

Nintendo shares fell 5.4% and Sony shares were down 9.4% in Tokyo on Friday.