Nintendo doesn't need to cut jobs for profitability, says Iwata

It may be tough going at the moment, but Nintendo believes a brighter future is on the horizon. During a Q&A session following the company's recent second quarter financial report, president Satoru Iwata said Nintendo is not planning any cost-cutting measures to boost profitability.

"If you believe that there is no possibility of Nintendo's results improving, then you would be right about it being necessary to review the structure of the workforce and the company itself to match the scale of the business," Iwata said. "However, I believe that there are upward and downward swings in the video game business, that Nintendo has the potential to be a larger-scale business, and that in order to achieve that potential, good developers, localization capability, and the ability to sell overseas are necessary."

Though Nintendo has added hundreds of positions over the span of a half-decade while at the same time sales have fallen, cutting jobs is not the right way to drive long-term profitability, Iwata said.

"We need a company with a lot of muscle, but a company that also has no excess fat--one that makes smart spending decisions," Iwata said. "Restructuring the workforce is not the first option we consider even when cost-cutting is required. I would like you to understand that this is because we do not see a dark future for Nintendo."

The Wii U, which has underperformed so far with 3.91 million units sold to date, continues to have a negative impact on Nintendo's profits, the company announced last week. Nintendo will release a number of marquee first-party titles in the coming months, including Super Mario 3D World (November 22) and Donkey Kong Country: Tropical Freeze (December 6), as well as Mario Kart 8 and Super Smash Bros. in 2014.