Core Viewpoint - Nintendo's stock surged over 10% following the unexpected success of its new game, Pokémon Pokopia, alleviating concerns about rising storage chip prices impacting software demand [1][3]. Group 1: Game Performance - Pokémon Pokopia's physical copies have sold out at major retailers in the U.S. and became the fastest-selling exclusive game on the Nintendo Switch 2, surpassing one million units sold [3]. - The game's popularity has significantly boosted sales momentum for the Nintendo Switch 2, helping to offset the pressure from rising storage costs that have affected Nintendo's stock since late 2025 [3]. Group 2: Financial Performance - Nintendo's quarterly operating profit was approximately 155.21 billion yen (about $998.5 million), falling short of analysts' average estimate of 180.7 billion yen, despite a sales increase of over 80% to 806.32 billion yen [4]. - The operating profit growth was limited to 23%, which did not meet market expectations, leading to concerns about the company's profitability due to rising storage component costs and pricing strategies in the Japanese market [4]. Group 3: Market Concerns - The rising costs of storage components, driven by strong demand from AI data centers, have created a "revenue without profit" dilemma for the Nintendo Switch 2, despite increased sales [4]. - Nintendo's low-price strategy in the Japanese market is further eroding profit margins, and the company has maintained a conservative annual outlook and hardware sales target of 19 million units from June to the end of March [4].