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Pokémon didn’t come to the rescue of Nintendo after all.
The Kyoto-based games group slashed its annual operating profit by a third as the stronger yen wiped off gains from the runaway success of augmented reality mobile game Pokémon Go, writes the FT’s Kana Inagaki.
For the fiscal year through March 2017, Nintendo said it now anticipates an operating profit of ¥30bn ($288m) instead of an earlier forecasted profit of ¥45bn. But the firm raised its net profit guidance by 43 per cent to ¥50bn following the sale of its majority stake in the Seattle Mariners baseball team in August.
Analysts had already predicted that the company would receive only a modest share of Pokémon Go’s total revenues via its 33 per cent stake in the Pokémon Company and an estimated 5-10 per cent share of the game’s developer Niantic.
Nintendo said currency-linked losses totalling ¥39.9bn in the fiscal first half outweighed ¥12bn in gains from its investment in Pokémon Company.
The profit warning came as Nintendo is looking to revive its gaming business through the March 2017 launch of a new games console called Switch, which was revealed in a three-minute video last week. The company is also planning to release Super Mario Run as an exclusive title for Apple iPhone users this December.
The company reported nearly a twenty-fold increase in net profit to ¥62.8bn for the July to September quarter on the Seattle Mariners stake sale while revenue declined 34 per cent from a year earlier to ¥74.8bn.