Nintendo Discusses Reasons For Increased R&D Spending, Including Developing New Titles And Next-Gen Hardware

Nintendo Discusses Reasons For Increased R&D Spending, Including Developing New Titles And Next-Gen Hardware

Earlier this month, Nintendo published their latest financial report for the last fiscal year, which was overall quite a successful one for the company.

Within these reports, one of the more interesting points of note was that Nintendo set a new record for research & development (R&D) spending, and anticipated expenses of nearly 100 billion in this area for the current fiscal year.

Although the most obvious conclusion to draw is that this funding will be going into developing new models of the Switch, it could also point towards more unconventional gaming experiences such as the LABO or Mario Kart Live: Home Circuit, or even just development of even more new games.

With regards to this increased R&D spending, Nintendo President Shuntaro Furukawa had this to say during the Q&A portion of Nintendo’s financial results briefing:

Our software development costs, which include outsourcing, are increasing as we work to maintain a continuous stream of new titles for Nintendo Switch as it enters the middle of its lifecycle. Because per-title development costs are higher now than they were on past platforms, we anticipate that R&D expenses will continue to rise as we work to maintain a sizeable lineup of titles.

We are also conducting a variety of studies, which include investigating ways to enhance our digital business, and future services that will help maintain long-term relationships with our consumers, as was touched on in the Corporate Management Policy Briefing last September.

In addition, the development of the next generation of hardware needs to begin years before launch, so R&D expenses for that are gradually rising. We are aiming to grow by continuing our integrated hardware-software entertainment business, and that means conducting all sorts of research and development in various areas including both hardware and software.

Notably, Nintendo seems to have avoided sharing any hints about exactly what new hardware they might be working on, and what statements they did make suggest it could be quite a while before we will find out. We will be sure to report back with more details as they come.

What do you think? Let us know in the comments.