Nintendo’s 2016 Annual General Meeting of Shareholders Q&A 14: Earnings Forecast

NintendObserver“We are planning for NX to make up for falling Wii U sales. Software for NX will also contribute to sales and profit.” 

 

☆ NintendObs Event – Nintendo’s 2016 Annual General Meeting of Shareholders.

Nintendo’s 2016 Annual General Meeting of Shareholders

 

 

Question:

I have a question about your earnings forecast for this fiscal year. With the Wii U effectively withdrawing from the market, Wii U hardware sales are projected at 800,000 units, and with the 3DS also having peaked, there is a slight decline in projected sales volume. This makes the operating income target of 50% year-on-year growth to ¥45 billion look less than fully credible. There is also a sense that the company’s projections could be revised downward substantially around the end of the calendar year or the beginning of the new calendar year, and that the NX launch date could be postponed. As such, I would appreciate hearing what you can tell us about the basis for the ¥45 billion operating income target, and any detailed breakdown of this figure.

 

Answer:

Kimishima:

The Nintendo 3DS business has already surpassed cumulative global hardware sales of 58 million units. We believe that the Nintendo 3DS business will generate sufficient profit as long as we can deliver the software titles that are planned for release. The Pokémon series is marking its 20th year since the first title was released, and the series has topped total sales of 200 million games worldwide. Pokémon Sun and Pokémon Moon are the latest series titles, scheduled for release in November 2016, and we expect these to make a substantial profit contribution.

While we announced our shipment forecast of 800,000 Wii U hardware, we are forecasting total sales of ¥500 billion for this fiscal year, about the same as last year. I am not currently able to talk about concrete figures for unit sales, but we are planning for NX to make up for falling Wii U sales. Software for NX will also contribute to sales and profit.

We are preparing to release around five smart device applications (including Miitomo) by next March, and predict that the smart device business will also contribute to profit.

One factor that merits caution, however, is the UK’s decision to leave the EU. While we still do not have a clear picture of how this will affect exchange rates, a continued strong yen may impact our sales and profit, as overseas sales account for more than 70% of our total sales.

 

— The 76th Annual General Meeting of Shareholders
Source: Nintendo JP.

 

 

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