Investors Meeting: Q&A transcript now available in English (April 2016)

Last week, Nintendo had its usual meeting with investors, which always follows the release of the latest financials. The transcript of the Q&A was posted in Japanese last week, but it’s now available with an official English translation on Nintendo’s website.

Here’s the various questions asked by investors:

Q1: Impact of NX pre-launch period on the Nintendo 3DS

We have major titles for Nintendo 3DS for the fiscal year ending March 2017, as I mentioned in the presentation, and there is a solid lineup of titles. That should greatly contribute to the sale of both the hardware and the software.

Q2: Game design for smart device applications
Q3: Details about Miitomo (Daily Active Users, contribution to earnings, positive effects of connection with Nintendo Account system), more game elements in future mobile game to increase in-app purchases?
Q4: How series is Nintendo about its initiative on game for smart devices? How much management ressources are being shifted to mobile games? Could Shigeru Miyamoto create a game for mobile devices?
Q5: Will the NX come with a solid line-up of games? Will it be sold at a loss at launch?

One of the reasons for choosing the launch timing that we did is so that the software lineup will be ready in time for the hardware launch. Not only at launch, but we also need to be able to continuously release titles after launch. We are planning for this to be a platform that consumers can enjoy for a long time.

Also, Tatsumi Kimishima explained that the Yen was strong when the Wii U was released (and sold at a loss). It’s most likely not going to be the case for the NX platform, so they’re going to keep that in mind when determining the price.

Q6: Is Miitomo’s reception what Nintendo was expecting?

I believe this business requires us to continue to update to respond to these opinions in various ways, so we knew from the beginning that we would not be able to satisfy everyone right away. We believe that it is important to continue to revitalize the applications by quickly implementing feedback from consumers. Only one month has passed since distribution began. Our goals are to act on the feedback we received during this period quickly and increase the amount of consumers who are playing daily.

Q7: Is the number of Daily Active Users the most important indicator to determine whether a mobile app is successful or not?
Q8: What indicators will be important when developing the same IP for both smart devices and dedicated video game systems?

We believe that in addition to the number of units purchased, the activity numbers including hardware activity, and how much the game continues to be played are both important factors as well. I think that this is the same for both dedicated video game systems and smart devices.

Q9: Is the NX launching in March and missing the holiday season a sign Nintendo’s approach has changed?

A pretty important answer, which is why we’re putting the whole answer just below:

There has been no change in our way of thinking about launch times. We believe that when launching hardware, the amount of quality software for consumers to play that is available at launch is important, and that we ought to determine our launch dates based on this. The fact that consumers spend more money in the holiday season may be a big factor in why launching then is a good way to start. However, our hardware and software business structure does not end in that year. We want consumers to continue to play this game system for many years, so we believe that in the beginning it is most important to make sure that everything is in order at launch. In that sense, our approach is that we should wait until we can provide a fully realized experience rather than rushing to launch in the holiday season, and this approach has not changed.

Head after the break for the rest of this post!

Q10: Nintendo’s approach to on-hand cash management
Q11: How much will smart device projects contribute of the company’s overall revenue and profit in the fiscal year ending March 2017?
Q12: Do you think you can cover the decline of the Wii U with the new NX?

We are predicting about 800,000 Wii U hardware sales in the fiscal year ending March 2017, which is a decrease of about 2.4 million units compared to the previous year. NX and smart device business will be essential to cover this gap, but we also expect download content business to play a role. However, we are planning with the expectation that NX sales will compensate for much of the impact on sales from reduced Wii U hardware sales.

Source: Nintendo