Nintendo said on Thursday that it expects profit for its current fiscal year to jump by 121 percent, hitting a seven-year high, thanks to strong sales of its new Switch console, older
The Japanese gaming giant forecast for the fiscal year ending March 31, 2018:
On Thursday, Nintendo reported earnings for the fiscal year ended March 31, 2017. The key figures are:
Nintendo's forecasts, however, set it up for a strong year ahead. Its forecast of 65 billion yen of operating profit, if realized, would mark a 121 percent increase. It would also be the biggest profit
It's a positive announcement to
Thanks to its efforts in mobile, Nintendo's brand has also seen a strong revival, and the company has managed to tap into some of the nostalgia around its past games and consoles. Last year, the company released a Nintendo Classic Edition, which came with pre-installed games and cost $59.99. It quickly sold out with some going on eBay for as much as $5,000. Nintendo said the NES Classic launched to "widespread popularity".
And the knock-on effect has been seen in sales of Nintendo hardware. The company said the 3DS handheld console, which was released in 2011, saw a 7 percent year-on-year rise in sales. This was helped by strong titles such as "Pokemon Sun" and "Pokemon Moon", which gained popularity because of "Pokemon Go".
"The release of the smart device application 'Pokemon Go' led to increased sales of software in the Pokémon series and drove the Nintendo 3DS family hardware sales growth outside of Japan," Nintendo said in its earning statement.
Investors have been supportive of Nintendo's turnaround efforts with shares up 60 percent in the last 12 months. The stock also has 5 strong buy ratings, 10 buy ratings, 5 holds, 1 sell and 1 strong sell, showing the bias is generally positive towards the company's shares. The mean price target on the stock is 31,175 yen, which represents around 14 percent upside from Thursday's close, Reuters data shows.
"The brand has been reinvigorated and now with that revitalized branding of the licenses, this year and into next year is about pushing on with new differentiated cutting edge tech," Neil Campling, head of global technology, media and telecom research at Northern Trust Capital Markets, told CNBC by phone.