Third Quarter Financial Results Briefing for Fiscal Year Ending March 2016

Third Quarter Financial Results Briefing
for Fiscal Year Ending March 2016

Outline | Presentation by the President | Q & A

If you quote any or all of this Q&A, please display the URL of this website or put a link to this website.

1	Miitomo seems more like a communication application than a game. Can you tell us any more about the other approximately four titles that will be released after Miitomo by March of 2017, such as the intellectual property (IP) that will be used or the direction of these titles?
1	Tatsumi Kimishima (President): First, I'd like to reiterate that we have not placed any restrictions on the use of our character IP in these titles. We believe it is important to consider the timing and design of these titles to create a synergistic relationship with the games on our existing dedicated video game systems that use Nintendo characters. We are also considering developing titles for smart devices that are not at all tied to any games on our existing dedicated video game systems. We believe Nintendo is uniquely poised to connect applications for smart devices with games on dedicated video game systems. We are currently developing the next titles using Nintendo's character IP, so we hope you will look forward to them. We will have more concrete announcements in the future.

Miitomo seems more like a communication application than a game. Can you tell us any more about the other approximately four titles that will be released after Miitomo by March of 2017, such as the intellectual property (IP) that will be used or the direction of these titles?

Tatsumi Kimishima (President):

First, I'd like to reiterate that we have not placed any restrictions on the use of our character IP in these titles. We believe it is important to consider the timing and design of these titles to create a synergistic relationship with the games on our existing dedicated video game systems that use Nintendo characters. We are also considering developing titles for smart devices that are not at all tied to any games on our existing dedicated video game systems.

We believe Nintendo is uniquely poised to connect applications for smart devices with games on dedicated video game systems. We are currently developing the next titles using Nintendo's character IP, so we hope you will look forward to them. We will have more concrete announcements in the future.

2	You just mentioned that the release of applications for smart devices may be timed to achieve synergy with games for existing dedicated video game systems. Can you provide any other information about when we should expect to understand the overall picture, including the smart device business and NX (the new game platform under development), including things such as how future applications for smart devices might be timed to achieve synergy with the release of NX?
2	Kimishima: To start, I'd like to point out that we aren't going to be sharing any details about NX today. I may not be able to answer the question in full as it relates to NX. We have not only NX, but also the Nintendo 3DS and Wii U platforms, and we are of course considering ways to link smart device applications with games for these platforms as well. On the other hand, our development plan is also considering providing new ways to play aimed specifically at smart devices. Since I can't share any more information about NX at this time, that is all I can say to address the question. Thank you.

You just mentioned that the release of applications for smart devices may be timed to achieve synergy with games for existing dedicated video game systems. Can you provide any other information about when we should expect to understand the overall picture, including the smart device business and NX (the new game platform under development), including things such as how future applications for smart devices might be timed to achieve synergy with the release of NX?

Kimishima:

To start, I'd like to point out that we aren't going to be sharing any details about NX today. I may not be able to answer the question in full as it relates to NX. We have not only NX, but also the Nintendo 3DS and Wii U platforms, and we are of course considering ways to link smart device applications with games for these platforms as well.

On the other hand, our development plan is also considering providing new ways to play aimed specifically at smart devices. Since I can't share any more information about NX at this time, that is all I can say to address the question. Thank you.

3	With regards to the financial performance, I believe you said that the fiscal year ending in March 2016 has been about balancing revenue and expenses, while the next fiscal year (ending in March 2017) will be a step towards aiming for Nintendo-like profits. Have these priorities changed at all? It seems like a lot of new endeavors, such as smart device business and amiibo sales, will need to go smoothly in order to realize Nintendo-like profits. If you had to provide one example of an area where you can be sure to achieve Nintendo-like profits, what would that be?
3	Kimishima: The previous and current fiscal years have been a period of preparation to launch a number of new endeavors, such as NX development, development for smart devices and business using our character IP, in addition to driving our Wii U and Nintendo 3DS businesses. At the same time, it has been our priority to take a close look at areas of our existing business where the revenue and expenses had become unbalanced, and to make sure that we corrected this balance. As I have said before, we will be launching many of our new business activities as we move from this fiscal year into the next. When you start any new business, it is important to make the public aware of what you will be doing. In the next fiscal year, we will have to make preparations and investments to achieve these goals, and that comes with certain costs. The question was to pick one area with which we will be able to achieve Nintendo-like profits, but I would like to suggest two areas. One area is our NX business, and another is our business for smart devices. I believe that keeping these two endeavors on track will be key to achieving Nintendo-like profits. I don't have any further details to share about the next fiscal year at this time, but we will explain about our plan and when we will aim to achieve Nintendo-like profits at a future date.

With regards to the financial performance, I believe you said that the fiscal year ending in March 2016 has been about balancing revenue and expenses, while the next fiscal year (ending in March 2017) will be a step towards aiming for Nintendo-like profits. Have these priorities changed at all? It seems like a lot of new endeavors, such as smart device business and amiibo sales, will need to go smoothly in order to realize Nintendo-like profits. If you had to provide one example of an area where you can be sure to achieve Nintendo-like profits, what would that be?

Kimishima:

The previous and current fiscal years have been a period of preparation to launch a number of new endeavors, such as NX development, development for smart devices and business using our character IP, in addition to driving our Wii U and Nintendo 3DS businesses. At the same time, it has been our priority to take a close look at areas of our existing business where the revenue and expenses had become unbalanced, and to make sure that we corrected this balance. As I have said before, we will be launching many of our new business activities as we move from this fiscal year into the next.

When you start any new business, it is important to make the public aware of what you will be doing. In the next fiscal year, we will have to make preparations and investments to achieve these goals, and that comes with certain costs.

The question was to pick one area with which we will be able to achieve Nintendo-like profits, but I would like to suggest two areas. One area is our NX business, and another is our business for smart devices. I believe that keeping these two endeavors on track will be key to achieving Nintendo-like profits. I don't have any further details to share about the next fiscal year at this time, but we will explain about our plan and when we will aim to achieve Nintendo-like profits at a future date.

Outline | Presentation by the President | Q & A