Nintendo Switch
Image: Nintendo

Nintendo's stock price fell by as much as 8.8% on Friday, the biggest daily drop the company has experienced since February 2019, Bloomberg reports.

The drop comes despite a seemingly positive earnings report shared yesterday; while Nintendo's profits are down year-on-year, which is to be expected following last year's pandemic boom, sales have remained strong. Indeed, Nintendo stated that it's in such a "favourable cash position" that it plans to spend up to 100 billion yen buying back and cancelling some of its own shares – a move which would usually see a boost in stock, rather than the opposite.

So why has Nintendo's stock fallen so dramatically? Bloomberg suggests there might be concern that demand for gaming is set to decline as the world slowly emerges from the pandemic, also highlighting that semiconductor shortages are still affecting Switch production. Hideki Yasuda, analyst at Ace Research Institute, shared the following:

"Games this quarter were not enough to patch the hole left by Animal Crossing. July market data shows Switch and Switch Lite sales are falling. Nintendo will have another tough time ahead in the July-September quarter, which could be worse than the April-June period."

Whatever the reasoning, the numbers don't lie. Here's a Bloomberg chart comparing Nintendo's, Sony's, and Microsoft's stock over the past few months – it seems things have been steadily declining for Nintendo since the announcement of the Switch OLED model.

Image: Bloomberg

During yesterday's report, Nintendo revealed that Switch sales have now surpassed 89 million units, and also provided an updated look at Switch's best-selling games of all time.