Nintendo (OTCMKTS: NTDOY) stock is surging on Thursday, November 5, following the highly successful launch of The Legend of Zelda: Ocarina of Time remake for the Switch 2.
Like the original, the game was met with universal acclaim, and the developer’s shares reacted with a 6.75% up-tick, now trading at $13.76 over-the-counter in the U.S.
The rally was further supported by Nintendo’s third-quarter earnings report. As the report showed, the company has sold over 26 million Switch 2 units since it launched in summer last year.
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However, from July to September 2026, net profit was down 29%, coming in at ¥73.5 billion (~$465.3 million), meaning it missed estimates of 82.2 billion yen.
Nintendo stock rises despite falling sales
Despite lower sales, Nintendo reported an 11% year-over-year (YoY) increase in net profit for the first half of fiscal 2027. Currently, management maintains its full-year net profit forecast of ¥310 billion.
The company sold nearly 6.5 million Switch 2 consoles during the first half of the fiscal year, compared with approximately 10.4 million in the same period a year earlier, when the new console was benefiting from strong launch demand.
Nintendo did admit that lower hardware sales weighed on revenue, but that operating profit still increased by nearly 50% during the first six months, supported by steady software sales and refunds related to U.S. tariffs.
“Although sales declined year-on-year due to lower hardware unit sales, operating profit rose 49.1% to 216.5 billion yen. This increase was driven by steady software sales, which accounted for a larger share of total sales, and a first-quarter refund of U.S. IEEPA tariffs previously recorded as cost of sales,” Nintendo wrote.
Notably, the company raised the price of the Switch 2 this year, potentially adding another obstacle to expanding its customer base. What’s more, investors have also noted a lack of major blockbuster releases as a factor behind weaker hardware demand.
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Can Ocarina of Time launch reverse the trend?
Looking forward, Nintendo is hoping its latest addition to the long-running Zelda franchise can help reverse the negative sales trend.
The remake of the 1990s classic was released as part of the series’ 40th anniversary celebrations, and as mentioned, it received overwhelmingly positive scores, being rated 96 out of 100 on Metacritic.
As part of its business strategy, the company said it would continue working to expand the Switch 2 install base while leveraging the original Switch’s software library to sustain engagement and game sales.
This will, of course, be necessary if Nintendo is to compete with its rivals. For example, Sony (NYSE: SONY) posted a 44% YoY increase in second-quarter net profit to ¥449.6 billion, supported by strong performances across both its gaming and film businesses, which Nintendo now has to compete with, as a new Zelda movie is also in production.
Featured image via Shutterstock
