It is the day of earnings calls. Two tech giants Apple and Twitter have mostly repeated their history of exceeding expectations and disappointing investors respectively. But there is an immense curiosity around the earnings of another company which has made most headlines over the past few days. Yes, you guessed it right- it is related to Pokemon Go!
Nintendo, the company with 32% stake in The Pokemon company and 13% equity in Niantic Labs, just released its earnings call. And no, the effect of the crazy, insane popularity of Pokemon Go is not visible in it.
The company posted a revenue of $587 million (62 billion yen) which was 30% less than the same period last year. On top of it, it suffered a loss of $49 million (5.13 billion yen) in the last quarter. However, Nintendo had already clarified that the overnight success of Pokemon Go would not have any considerable financial impact on the company, considering that it hasn’t actually even developed the game.
This was bit surprising given the fact that post-Pokemon Go, the market valuation of Nintendo had soared past $40 billion in past few weeks. But since the company has not developed the game itself, it has not shown confidence in its role on its finances.
Still one can expect a more significant share of Pokemon Go on Nintendo fortunes. Pokemon Go has already begun monetizing efforts. It recently came up with “sponsored locations”, initially with McDonalds in Japan. It also has plans of a $30 Pokemon Go Plus wearable accessory which will hit the shelves in September this year.
Declining popularity of Nintendo gaming consoles
Coming back to Nintendo, it has been suffering mainly due to the declining popularity of its gaming consoles. This quarter, its Wii U console sales saw a further decline as the company sold just 220,000 units. And this was 50 percent fewer than the same period last year.
Lately, Nintendo has also entered smartphone gaming as it released its first Android and iOS game this year. The game called, Miitomo once boasted of 10 million users but its popularity has been shrinking for some time now.
The company reported revenues of 1.65 billion yen ($15.6 million) from smart devices products and IP licensing which include Miitomo.
However, the company has plans to bring new consoles and mobile games to turn around its fortunes. First, there is a lot of curiosity around its next flagship console called Nintendo NX. It is a high powered portable gaming console through which Nintendo hopes to attract the new generation of gamers. It has scheduled its launch in March 2017.
Secondly, Nintendo is coming up with two new mobile games called Fire Emblem and Animal Crossing this year. These games will help in increasing the share of smartphone revenues further.
The company is also planning to revive its iconic product- the NES console. It is reportedly developing a miniature version of that console priced at $60. This could further bring back Nintendo its lost popularity as the legendary gaming company.