Nintendo Boosts Forecast 50% As “Stay At Home” Video Gaming Demand Skyrockets
By Tyler Durden
While most “stay at home” stock focus during the pandemic has been on names like Zoom, Slack and Pelton, it seems the video game industry has snuck past many “mainstream” analysts’ radar.
But that doesn’t necessarily mean that these stocks aren’t worth paying attention to. In fact, well-known financially conservative video game company Nintendo spiked on Thursday after it raised its forecasts midway through its fiscal year.
Shares were already up more than 30% this year, before finishing the day up another 6% on the announcement. The company’s announcement is a sign of “robust gaming demand from consumers stuck at home during the pandemic,” according to Bloomberg.
Nintendo raised its operating profit to $4.3 billion (450 billion yen), up from $2.15 billion (225 billion yen) and boosted its revenue forecast from 1.4 trillion yen to 1.2 trillion yen. It also raised guidance on Switch consoles sold, up to 24 million units from 19 million units.
The company reported an operating profit of 146.7 billion yen for the September quarter, beating estimates of 96.2 billion yen. It also thrashed top line expectations, reporting 411 billion yen in revenue compared to estimates of 321.4 billion yen.
Amir Anvarzadeh, a market strategist at Asymmetric Advisors in Singapore, said: “So another blow-out quarter. These are type of (operating profit) levels we tend to see in the current holiday quarters. So we will have 3 Xmas quarters in one term.”