Nintendo to hike wages despite firmer yen

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Nintendo to hike wages despite firmer yen

TOKYO Japanese video game maker Nintendo Co Ltd said on Tuesday it plans to lift workers' base pay by 10 per cent even though a firmer yen forced it to trim its full-year profit forecast.

Prime Minister Fumio Kishida has been calling for Japanese companies to pay more as inflation takes hold in the economy used to years of deflation and stagnant wages and Japan prepares for its annual spring round of labour negotiations.

Fast Retailing Co Ltd, the parent of Uniqlo clothing chain, was one of the first companies off the block, jolting Japan Inc when it said last month it would hike wages by as much as 40 per cent.

It's important for our long-term growth to secure our workforce, according to Nintendo President Shuntaro Furukawa.

Higher salaries may help companies attract talent as a falling birth rate and low immigration leave Japan with serious labour shortages, as they can afford to do so.

The operating profit for Super Mario Bros and Legend of Zelda was cut by 4 percent to 480 billion yen $3.6 billion for the year to March 31, much less than the Refinitiv consensus forecast for a profit of 582 billion yen.

Nintendo also revised its software sales forecast to 205 million units from 210 million, and cut its Switch console sales target to 18 million units from 19 million units.

Furukawa said that the Kyoto-based company would consider doing so if circumstances required it, even though it does not plan to raise software or game console prices. When asked if the company was considering a successor to the six-year old Switch, he wouldn't say anything.

In the latest quarter, Nintendo, which competes with Sony Group Corp and Xbox maker Microsoft Corp, sold 8.2 million Switch units, a 23 per cent decline from the same period a year ago.