Nintendo R&D Costs Rise By 80% For Tackling Weaknesses

In the ongoing fourth quarter (Jan – March) of their financial year, Nintendo estimate that their research and development (R&D) expenses will increase by about 80% compared to the same period last year. At a financial results Q&A with investors and analysts, Nintendo president Satoru Iwata was asked why this was the case.

“Regarding the research and development expenses for this fiscal year, many people seem to have been surprised by such a sudden increase and I heard from the IR team that they received many questions on this topic from financial analysts,” Iwata replied.

He continued: “Yesterday, I received the same question when we made our financial announcement at the Osaka Securities Exchange and answered that we decided to increase our forecasted expenses this fiscal year in order to tackle some of the areas that we feel we are not strong at, and this is an investment toward the future.”

Iwata added: “I will not, however, go into detail about these specific areas since doing so does not benefit Nintendo or our shareholders. Please also note that the rise is unique to this fiscal year and it does not signify a general rise for and beyond the next fiscal year.”

These R&D expenses could be associated with just about anything. Nintendo could be investing in their future plans for online services. Alternatively, they could be investing in their plans to enter the health and quality of life market. They could even be investing money toward researching integrated architecture and operating systems for their future devices.