September 14, 2022: -On Tuesday, Nintendo shares increased 5% after the Japanese gaming company said its new title surpassed a domestic sales record.

The company added that sales of Splatoon 3 in Japan surpassed 3.45 million units, a household record for any Nintendo Switch software within the first three days of sales.

Launched on September 9, the action-shooting game was one of the highly anticipated titles in Nintendo’s line-up this year.

The title’s success reduced fears about an industry slowdown after a pandemic-fueled boom that saw people spend more time at home playing games. Investors are also concerned regarding the impact of a potential recession on the video game market. Gaming giants Nintendo, Microsoft, and Sony glimpsed disappointing results in the second quarter.

But Serkan Toto, CEO of consultancy Kantan Games, named Splatoon 3 a “cult hit” in Japan and said the recent slowdown in the gaming market was due to a lack of important titles.

“I’m not a big subscriber of the idea that the recession puts a dent into the video game industry. I think it was a drought of blockbusters,” Toto told CNBC.

“I think it’s the case that people are drawn to this kind of blockbuster game no matter if there is a recession on the horizon or not,” he added.

The gaming industry still faces several headwinds, including supply chain issues.

But the success of games such as Splatoon helps keep the momentum for Nintendo’s flagship Switch console, which is now more than five years old, particularly as the holiday season approaches.

In November, Nintendo is also gearing up to release the latest games in its popular Pokemon franchise. On Tuesday, the company will hold its Nintendo Direct event, where it will show details of upcoming games.