Gamers line up for Nintendo Switch 2 on launch day

By Sam Nussey and Tom Bateman

TOKYO (Reuters) -Gaming fans queued up for the launch of Nintendo's Switch 2 on Thursday amid pent-up demand for the more powerful next-generation gaming device.

"The level of demand seems to be sky-high," said Serkan Toto, founder of the Kantan Games consultancy.

In the Ikebukuro shopping district of Tokyo, dozens of successful applicants to a sales lottery by electronics retailer Bic Camera lined up before the store opened to collect their devices.

"I feel like I'm going to cry," Yumi Ohi, a 30-year-old delivery contractor, told Reuters.

Ohi had missed out in other lotteries and had come from Saitama prefecture, adjacent to Tokyo, to receive her Switch 2.

Nintendo has sold 152 million Switch home-portable devices since launching in 2017. It became a games juggernaut with titles including two "The Legend of Zelda" titles and COVID-19 pandemic breakout hit "Animal Crossing: New Horizons".

The Switch 2 bears many similarities with its predecessor but offers a larger screen and improved graphics and debuts with titles including "Mario Kart World".

"The much larger audience of Switch users should translate to stronger adoption in the opening part of its lifecycle," said Piers Harding-Rolls, an analyst at Ampere Analysis.

"Nintendo is better prepared this time around" to deal with the high demand, he said.

The launch of the $499.99 Switch 2 is a test of Nintendo's supply chain management during U.S. President Donald Trump's trade war.

Nintendo last month forecast sales of 15 million Switch 2 units during the current financial year, as well as 4.5 million Switch units.

President Shuntaro Furukawa said Nintendo will strengthen production capacity to respond to strong demand and focus on sales promotion in an effort to exceed the forecast.

"Given it's a special occasion, I wanted to buy (the Switch 2) right away on its release date," said Shinichi Sekiguchi, a hotel receptionist in his thirties.

Nintendo said it received 2.2 million applications for its Switch 2 sales lottery on its My Nintendo Store in Japan. Pre-orders at Target sold out in less than two hours.

"You are looking at weeks or months until you can walk into a store and buy a Switch 2," said Toto of Kantan Games.

Investor expectations for the new device are similarly lofty.

Nintendo's shares, which closed down 2% in Tokyo, have gained 28% this year.

Concerns include whether momentum for the Switch 2 will be sustained after hardcore gamers have upgraded.

"The volume of first-party games on offer at launch isn't as strong as it could be, so some more casual users may wait and see how the games available build over the next one to two years before making the leap," said Ampere's Harding-Rolls.

Ampere forecasts Switch 2 sales to exceed 100 million units in 2030.

"Mario Kart World" has a U.S. sticker price of $79.99, generating debate over the price of games. Nintendo is also attracting third-party titles to the system.

"I've been around since the era of the Super Nintendo Entertainment System and games from (that period) were expensive too so I think it's somewhat within the acceptable range," said Akitomo Takahashi, a salesman in his forties.

Takahashi said he was keen to play action role-playing game "Elden Ring" on his Switch 2.

(Reporting by Sam Nussey and Tom Bateman; Editing by Christopher Cushing)