Summary
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Next Level Games probably won't be revisiting the Punch-Out series anytime soon because it's considered dead due to sales and stereotypes.
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Backlash over stereotyping played a significant role in preventing the Punch-Out series from continuing.
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Despite being loved, Punch-Out did not reach the same sales potential as other Next Level Games titles.
Gaming insider Imran Khan said that Next Level Games probably won't revisit Punch Out series soon, saying that the cult classic Nintendo series is effectively dead. The Punch Out the series is one of Nintendo's most niche titles, with the first title released in 1984 for arcades. The series is better known for its home console counterpart, Mike Tyson's Punch-Out on the NES in 1987, with many players claiming it to be one of the most challenging yet rewarding titles on the system. The game then received a sequel on the SNES in 1994 that played closer to its arcade iteration.
Most fans will probably be familiar with Next Level Games from 2009 Punch Out revival, rebooting the series and pitting Little Mac against some really tough, cartoonish boxers. Next Level Games' Punch Out the reboot was both a critical and commercial success, helping to solidify the studio as a trusted partner with Nintendo. Next Level Games has since been acquired as a primary developer for Nintendo, working on games such as Luigi's Mansion 3 and Mario Strikers: Battle League. Despite Nintendo being its parent company, there appears to be no plan to overhaul it Punch Out anytime soon.

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In a recent ResetEra thread, Imran Khan talked about how he spoke to someone “some time ago” who was involved in the last Punch Out title by Next Level Games and if there was a new one in the works. According to the person Khan spoke to, despite the popularity of the Nintendo cult classic series, the amount of backlash Punch Out received over the characters and stereotypes represented was more than expected. The development team was apparently assuring Nintendo that they weren't leaning into bad stereotypes that would earn them a bad reputation. Khan notes that it is also not a case of Punch Out the team doesn't want to use stereotypes, but rather can't “completely cut out of the past” without backlash. “I guess it's less 'We can't do this without stereotypes, so let's not bother!' and more a World Warriors Problem is they can't completely cut from the past without people rioting,” Khan said. “That and other games from the studio are selling 14 million more copies, so why bother.”
Crippled Punch-Out Wii sales and stereotypes
Khan also comments on the sales of Punch Out series compared to other titles developed by Next Level Games. while Punch Out on the Wii it sold over a million copies, it didn't have the same sales potential as Next Level Games' Mario Strikers and Luigi's mansion spin-offs. These titles in particular have outperformed Punch Out also seemingly dooming it to be another niche Nintendo series.
I guess it's less “We can't do this without stereotypes, so let's not bother!” and more a World Warriors problem where they can't completely cut out of the past without people revolting. These and other games from the studio sell 14 million plus copies, so why bother.
Punch Out is still loved to this day. Certain indie games like Thunder Ray have strong Punch Out vibrations in their gameplay and presentation. Little Mac is still a predominant character in Super Smash Bros. also debuting in Brawl as a support trophy and promoted as a playable fighter in 3DS/Wii U and Final games. The entire ResetEra thread complained Punch Outits fate, with many saying that Next Level Games did a spectacular job with the 2009 Wii game.