(BFM Bourse) – Despite expected lower console sales, the Japanese video game giant Nintendo is raising its sales and net profit targets for its 2022/2023 financial year ending at the end of March. The group is counting on the success of its next game releases as well as on the weakness of the yen against major currencies.
The Japanese video game giant Nintendo raised its annual forecasts for net profit and turnover on Tuesday, betting on its games and especially on the low yen, despite console sales targets revised downwards.
The group now forecasts for its 2022/2023 financial year (which will end at the end of next March) an annual net profit of 400 billion yen (2.7 billion euros, -16% over one year), against a previous outlook of 340 billion yen.
It is counting on sales of 1650 billion yen (11.2 billion euros) against 1600 billion yen previously, which would represent a slight decline of 2.7% over one year. Its operating profit forecast remained unchanged at 500 billion yen (3.4 billion euros), which would mean a decline of 15.7% over one year.
Nintendo is counting in particular to feed its turnover on the sales of new games like Splatoon 3, which has already sold nearly 8 million copies in the month of September alone after a record start in Japan.
Future boxes with Pokémon Scarlet and Violet or Bayonetta 3
Nintendo’s sales are also expected to be boosted in the second half by the expected release next week of the Pokémon Scarlet and Violet games, new versions of the hit monster-catching franchise, which will take place in an open world for the first time.
The latest installments of several gamer-popular series like Bayonetta 3 (released in late October) and Fire Emblem Engage, as well as the Kirby’s Return to Dream Land Deluxe remake are also expected to support the group’s revenue.
Noting “a gradual improvement in the supply of semiconductors and other components and a tendency to resume production” of its Switch console, Nintendo has however reduced its ambitions for this machine, expecting to sell only 19 million. units over the full year, compared to 21 million so far.
Some analysts believe that the advanced age of the Switch, which has already sold more than 114 million copies since its release in March 2017, could also hamper sales if a new version with muscular performance is not launched. shortly.
“We continue to believe that the life cycle of the Switch, already extended by the Covid, has far exceeded the expiry date”, slashed Amir Anvarzadeh in a note from Asymmetric Advisors.
Thus, while Nintendo’s game sales rose 1.6% year on year in the first half (April-September), those of its Switch consoles fell 19.2% “due to factors such as the shortage of semi- -drivers”, justified in a press release the firm of Kyoto (western Japan).
However, its results benefited throughout the period from the collapse of the yen, which has lost more than 20% of its value against the dollar since the start of the year, a currency movement that artificially inflates its sales abroad. Nintendo saw its half-yearly net profit jump 34% to 230.5 billion yen (1.6 billion euros).
Its operating profit remained stable at 220.4 billion yen (1.5 billion euros) and its sales increased by 5% to 657 billion yen (4.5 billion euros) over the period.
A joint venture with DeNA and a reorganization of activities in Europe
The Japanese video game pioneer also announced on Tuesday the creation of a joint venture with his compatriot DeNA, with whom he has been associated since 2015 for the development of games for smartphones.
This enhanced collaboration, which will notably concern players’ online accounts, should “strengthen the digitization of Nintendo’s activities” through the creation of “value-added services”, wrote the company in a press release, without giving further details.
In a separate press release, the Japanese group announced a plan to reorganize its commercial activities in Europe in 2023-2024: its subsidiaries in France, Benelux and Spain will disappear by merging with its subsidiary in Germany.
Nintendo did not specify whether this regional reorganization would be accompanied by job cuts.
(With AFP)
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