Nintendo Stock Drops by 7% After Disappointing E3 2018 Show

Nintendo stock has dropped by almost 7% following its disappointing E3 2018 Nintendo Direct, with the company's focus on Super Smash Bros Ultimate worrying investors after a strong launch year for the Nintendo Switch. Though the company has a couple of big releases up its sleeve, the lack of new announcements during the Direct and a reliance on Smash Bros Ultimate and Pokemon Let's Go to carry Switch sales this year hasn't been well-received.

As is typically the case, Nintendo opted to go the route of a Nintendo Direct presentation at E3 2018, rather than present a stage show. Many were hoping for more announcements pertaining to Metroid Prime 4 or even the rumored Star Fox Retro Studios game, though the presentation predominantly stuck to discussing Super Smash Bros Ultimate and touching upon Pokemon Let's Go.

Both games will likely perform incredibly well for Nintendo, but the market isn't so sure, with stocks dropping 6.21% after the show:

 

Nintendo has a history of struggling to continue to support its consoles. While its first-party games have always hit it out of the park, third-party is where it has faltered the most, and the Switch has already performed better in this department than the Wii U. Fortnite Switch was one of the highlights of the E3 2018 Direct announcement, and it will surely pull in big numbers for the console, but there was a lack of new stuff to get excited about for Switch owners.

According to Niko Partners analyst Daniel Ahmad, "Many analysts are doubting if Nintendo can achieve hardware and software sell in targets for Switch after the 2018 lineup was revealed." A lot riding on Smash and Pokemon this year." However, it isn't all doom and gloom. "Of course whilst that is some what of a concern, there is no doubt that Smash Ultimate will be the biggest Smash game ever," Ahmad continued. "Pokemon tying in with Pokemon Go/going back to Yellow will really help with sales. Also Nintendo is doing well in other segments such as mobile etc..."

E3 is the biggest US gaming event of the year, so many were hoping that the Switch would have a stronger showing. Though it's disappointing that this wasn't the case, this is hopefully just a blip in the Switch's lifespan and more exciting projects are on their way.