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Nintendo reported an operating loss of 37.3 billion yen ($460.9 million USD)

Nintendo posted its first-ever annual loss today after a year of struggling with poor Wii and 3DS sales.

For the fiscal year ended March 31, Nintendo reported a net loss of 43.2 billion yen ($532.5 million USD) compared to the prior year, which generated a profit of 77.6 billion yen ($958.9 million USD).

Nintendo also took a 36.2 percent hit to its revenue compared to the year before. The most recent fiscal year ended with $647.6 billion yen ($8 billion USD) in revenue while the company managed to generate over 1 trillion yen the year ending March 31, 2011.

In addition, Nintendo reported an operating loss of 37.3 billion yen ($460.9 million USD), which was only slightly better than the predicted 41.4 billion yen loss for the year ended March 31, 2012.

Nintendo can place most of the blame on poor Wii, DS and 3DS sales over the past year. For the fiscal year ended March 31, 2011, Nintendo sold 15 million Wii consoles. This number dropped to 9.84 million the most recent fiscal year. The Wii took a hit in the software department as well, with 102.3 million software titles sold compared to the previous year's 171 million.

As far as portable gaming goes, Nintendo DS sales dropped considerably from 17.5 million sold in the fiscal year ended March 2011 to 5.1 million sold in the most recent fiscal year. The 3DS, on the other hand, sold very well with 13.5 million sales. However, Nintendo was forced to slash the price last year, meaning each unit was sold at a loss.

The 3DS was released in March 2011 for $249.99. After Nintendo reported a net loss of 25.5 billion yen ($324 million USD) in the quarter ending June 30, 2011 and also realized that it had only sold 4.32 million 3DS units (830,000 in the U.S. total) since launch, the company decided to slash the price of the 3DS to $169.99. The price change was effective August 12, 2011.

Nintendo President Satoru Iwata blamed poor 3DS sales not just on price alone, but also a poor launch lineup of software titles.

"We also must reflect on the fact that we were not able to launch Nintendo 3DS at a time when a sufficient number of strong software titles were ready," said Iwata at the time.

Many say that new devices, such as smartphones and tablets made by tech giants like Apple (iOS devices like iPhone and iPad) and Google (Android operating system), have placed a competitive burden on Nintendo.

While the situation looks pretty bad for Nintendo right now, the Japanese gaming company has a plan to turn it all around. According to Nintendo, it will stop selling the 3DS below cost by the middle of the fiscal year ending March 31, 2013, and it will also launch more titles, such as a side-scrolling 2D "New Super Mario Bros. 2" game as well as the latest version of "Animal Crossing."

Nintendo is also hoping that the new Wii U console will save the sinking gaming company for the year ending March 2013.

"Nintendo will release the Wii U, the successor of the Wii, mainly in Japan, the United States and Europe at the end of this calendar year, and propose a new play style of home entertainment with its unique controller embedding a 6.2 inch touch screen," said Nintendo's latest financial report.

Nintendo's outlook for the fiscal year ending March 31, 2013 consists of net sales of 820 billion yen ($10.1 billion USD), an operating income of 35 billion yen ($432.5 million USD), an ordinary income of 35 billion yen, and a net income of 20 billion yen ($247.1 million USD). Also, Nintendo plans to sell 18.5 million 3DS units and 10.5 million Wii consoles this year.

Sources: Reuters, Nintendo

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Time For a Drastic Change!
By Reclaimer77 on 4/26/2012 11:00:12 AM , Rating: 1
Make 10 more Mario games and 50 more Zelda clones! That will pull you out of this slump Nintendo.

RE: Time For a Drastic Change!
By B3an on 4/26/12, Rating: 0
RE: Time For a Drastic Change!
By nolisi on 4/26/2012 11:42:39 AM , Rating: 3
Hmm, it took years- doesn't that mean that Wii was a success during that time and actually had a market?

I got a Wii years ago and still play- far more than my Xbox 360. My Xbox 360 now functions mostly as a media extender for MC.

RE: Time For a Drastic Change!
By acer905 on 4/26/2012 12:42:49 PM , Rating: 2
You know, if you're using Win7, you don't even need to deal with MC or the whole extender nonsense. Just share your videos, pictures, and music libraries over your network, and the Xbox will stream them without using the MC interface. I've found it to be much faster that way.

RE: Time For a Drastic Change!
By tayb on 4/26/2012 11:58:45 AM , Rating: 5
After 7 years on the market sales have dropped to 9 million annually and you think the issue is that people are starting to think it's gimmicky? Hardware sales literally blew Microsoft and Sony out of the water and if you include bundled games the Wii has some of the best selling games of all time. Wii Sports, Mario Kart Wii, Wii Sports Resort, Wii Play, Super Mario Bros Wii, Wii Fit, and Wii Fit Plus are all in the top 20 most sold video games of all time.

The console is just aging, it's no longer new, and the market is saturated with motion control consoles now.

I have a Wii and I've had it for 5 years and I love it. I have Mario Kart parties on occasion and use the console on a weekly basis.

RE: Time For a Drastic Change!
By Reclaimer77 on 4/26/12, Rating: -1
RE: Time For a Drastic Change!
By tayb on 4/26/2012 1:17:47 PM , Rating: 5
Wii had great game sales. According to vgchartz...

Wii - 784.22 million
360 - 627.30 million
PS3 - 538.06 million

Even if you remove bundled games such as Wii Sports and Wii Sports Resort Nintendo still outsold Microsoft and Sony.

The Wii had plenty of great non-bundled titles but the problem is they didn't have enough 3rd party titles. Super Mario Galaxy, Zelda, Mario Kart, Super Smash Bros, Mario Party, Donkey Kong, etc. They also sold their games at a lower price than Microsoft and Sony did. I rarely paid more than $40 for a game for the Wii. On the 360 you would rarely pay less than $60.

RE: Time For a Drastic Change!
By sigmatau on 4/26/12, Rating: 0
RE: Time For a Drastic Change!
By tayb on 4/26/2012 2:10:08 PM , Rating: 3
Yes, I did mean Microsoft or Sony.

That is true. The Xbox 360 had a far higher attachment rate than the Nintendo Wii ever did. But you also have to consider that Nintendo didn't ever have to sell the Wii at a loss like Microsoft and Sony did with their respective consoles. The Wii was profitable, from a hardware perspective, from day one I believe.

I would have to see P&L sheets for Microsoft, Sony, and Nintendo to really know which "boat" I would rather be in honestly. Nintendo bundled a lot of games with the console and sold their games much cheaper than Microsoft/Sony did. The numbers, from both sides, can easily mislead.

RE: Time For a Drastic Change!
By someguy123 on 4/26/2012 2:38:37 PM , Rating: 3
It seems a little silly to call the company a failure when it managed to profit per console and sell the highest amount of units, simply because it was underneath the competitor's consoles in attachrate. Where was this gloom and doom when microsoft and sony took a 3-5 billion dollar hit during their console launches? Quite substantial, but they pulled through.

Before the wii, nintendo and microsoft were far, far below sony in overall console sales. The industry doesn't seem like a winner take all scenario considering both microsoft and sony(gaming divisions) remain profitable with similar marketshare.

RE: Time For a Drastic Change!
By Reclaimer77 on 4/27/2012 12:49:43 PM , Rating: 2
But really, you made Reclaimer's point for him.

Yeah I'm still trying to process how he's looking at those same numbers and seeing a clear "win" there. When put in context, he made my point.

RE: Time For a Drastic Change!
By EnzoFX on 4/26/2012 1:54:03 PM , Rating: 2
Not to mention that it Nintendo sold their consoles for profit, not a loss like the others.

It was clearly a success, it's probably more likely due to a saturated market, they need to move on, but not in a more gimmicky way hah.

RE: Time For a Drastic Change!
By EricMartello on 4/26/12, Rating: -1
RE: Time For a Drastic Change!
By amanojaku on 4/26/12, Rating: 0
RE: Time For a Drastic Change!
By tarv on 4/26/2012 4:07:51 PM , Rating: 2
Well Nintendo's software division is what really drives their profits. They don't rely on that piddly little licensing fee that Microsoft and Sony have to. Nintendo has such a huge advantage in this area. Microsoft and Sony don't make games and don't reap the real financial benefits that Nintendo does. When you look at a game like Mario Kart Wii which has sold well over 10 million copies, its revenue pales in comparison to your average revenue gain for lets say CoD sales on Xbox or PS3.

RE: Time For a Drastic Change!
By amanojaku on 4/26/2012 11:04:21 AM , Rating: 4
Yeah, I'm worried that Nintendo is going to take a page from RIM's *ahem* playbook. The Wii U is a step up from the Wii, but it needed to be a step up or two from the PS3. Nintendo has "casual" and "party" gaming down pretty solid. Time to support the "hardcore" gamer (FPS, RPG, etc... with flashy graphics). Nintendo needs a Mass Effect, Crysis, Bioshock, etc...

RE: Time For a Drastic Change!
By wordsworm on 4/27/2012 10:57:25 AM , Rating: 2
The expression, "A candle that burns twice as bright burns half as long," seems applicable here.

By Labotomizer on 4/26/2012 11:45:00 AM , Rating: 5
First off, for those who say "Nintendo is in trouble". You need to read this article again. It's the first time Nintendo has EVER posted a loss. Ever... Sony is bleeding money, Microsoft has just now started making money on the XBox platform and hasn't actually turned a profit when you look at overall P&L on the platform. One bad year does not a company make. Nintendo has the cash stockpile to last another 10 years if the Wii U is a total flop, which it won't be.

Second, people knock them for Mario and Zelda sequels? Honestly? You do know that there are more CoD games than Zelda games right? And Zelda has been around 25 years, CoD less than 10. Mario gets a true platformer once every 2-3 years, Zelda roughly every 5 years. Mario Kart is a 3-5 year release cycle. They invest huge amounts of time to make sure each game is of absolute top notch quality and brings something new to the table. Your mature, AAA games do that how often? Exactly...

I'm a true gamer, which means I play games on my PC primarily, I play my 360 for some other games (like Madden) and I play my Wii because when it comes to a genuinely fun gaming experience the others don't match what it offers. Mario Kart, SMG 1&2, Zelda Skyward Sword are well worth the price of the console I bought I launch. And Nintendo will be around for a long time to come while the "hardcore" consoles struggle to ever make a profit.

RE: So many have no clue what they're talking about...
By tayb on 4/26/2012 1:31:04 PM , Rating: 2
The Wii was released in 2006 alongside Zelda Twilight Princess. Including that game there have been 5 Zelda games in the past 7 games. Of those 5 games I believe only 2 of them have been actual Wii releases. I think we have had a new CoD game every single year during that same time period.

Hell Call of Duty has been practically re-releasing the same Modern Warfare game since fall of 2007. At least Treyarch visits different time periods.

By fuzzlefizz on 4/26/2012 4:36:49 PM , Rating: 2
The CoD formula still seems to be working.. the Modern Warfare series has been the biggest cash cow game of any game of its generation.

It makes money, period.

By someguy123 on 4/26/2012 10:01:17 PM , Rating: 2 do franchise games from nintendo, yet for some reason people are telling them throw away that cashflow for the sake of "hardcore", which is such a vague term that has lost all meaning. There are very few games that are any difficult nowadays outside of arcade games like djmax, and every genre is being "streamlined". At this point I can only assume that hardcore = movie.

By Labotomizer on 4/26/2012 4:30:06 PM , Rating: 4
I'm counting home console AAA Zelda releases. If you want to count all the games for every system then we'd have to count each port of CoD and each DLC.

RE: So many have no clue what they're talking about...
By KFZ on 4/26/2012 4:39:17 PM , Rating: 3
I certainly wouldn't say Nintendo is in trouble, and it doesn't need fans rushing to defend it. Nintendo is the big kid on the block and has been for generations. To sit there and deflect criticism with a mantra that this is just one bad year is dense. The writing is on the wall and Nintendo needs to wake up.

Sidebar: Nintendo is very good at reinventing classic games, but it does NOT have a lock on putting hard work and fun into games. Lost Odyssey is an example of a great, underrated RPG, and I enjoyed that new experience. I don't want to play the elf in green for the Xth time, and that's fine. The thing is, I've heard diehard Nintendo fans concede it's not about originality, it's about the fun, so just drop the act and admit when you are biased.

By the way, it's kind of hypocritical to blast Call of Duty's procession. Nintendo wrote the book on milking successful franchises. I'll just leave this here:

By someguy123 on 4/26/2012 10:11:33 PM , Rating: 2
While I agree with you that it's never a good idea to ignore poor performance, you're talking about a situation where a quarter of poor performance is being used as reasoning for a rehaul/impending doom of nintendo. It's pretty silly either way.

Also those are a list of games that feature mario, not mario games. I don't know why people point to mascots as though all of their games are identical. How many of those games are of completely different genre? Is it really favorable to have a "new IP", while slapping on TPS/FPS gameplay? Hell they brought back syndicate and turned it into an FPS for some reason. They're doing the same with xcom, though firaxis is also developing a separate strategy version. Seems pointless to single out mascots while ignoring the gameplay completely.

By FITCamaro on 4/27/2012 8:16:55 AM , Rating: 2
Microsoft is a far more diversified company than Nintendo though. Microsoft didn't look at the small picture when it started the Xbox. It went in knowing it'd lose money in the short term. But the 360 has more than paid off for it. And the next Xbox will likely grow on its success.

I think its safe to say that no other company could have jumped into the video game console market as effectively and as successfully as Microsoft did.

Kill the Wii U
By Flunk on 4/26/12, Rating: 0
RE: Kill the Wii U
By Brandon Hill on 4/26/2012 11:14:37 AM , Rating: 3
Isn't it a bit too late to kill it now?

RE: Kill the Wii U
By Reclaimer77 on 4/26/2012 11:24:53 AM , Rating: 2
The problem is Nintendo never had the cash to make "loss leader" consoles like Sony and Microsoft. And they sure as hell don't now.

I agree with many of the other posters. For Nintendo to try and compete in the console business is a losing proposition. Adapt or die at this point.

RE: Kill the Wii U
By amanojaku on 4/26/2012 11:16:36 AM , Rating: 4
I say we take off and nuke the entire device from orbit. It's the only way to be sure.

The 3DS is the problem.
By zero2dash on 4/26/2012 1:46:27 PM , Rating: 2
3D is still a fad, the 3DS still costs $100 more than it should, and Nintendo is still relying on churning out the same stuff they've released to the nth degree time and time again on every other console of theirs.

Sorry - it's about time they take some losses and get knocked off their high horse. Nintendo fans are the new Apple fans. All hail the mighty Iwata! He can do no wrong!

....'cept this time, he did. And they're kidding themselves if they think a "marginally better than the current gen consoles" Wii U is going to sell to the soccer moms and old folks homes that bought the Wii up in droves. Those people will continue holding onto their Wii systems, and the "core gamers" that Nintendo claims to care about are going to buy the new Xbox and Playstation systems once those come out because they will blow away the Wii U and Nintendo will (as usual) have the weakest hardware available, only this time the motion controls won't be a 'new' thing.

RE: The 3DS is the problem.
By cscpianoman on 4/26/2012 8:49:57 PM , Rating: 2
I see a lot of bias in these comments. First off, the Wii was release Dec 2006 and since has sold 100 million consoles. In Nintendo's longstanding history the NES sold 61 million, the SNES sold 49 million and the Gamecube only sold 20 million. The Wii by all accounts and purposes sold like a firestorm. It is now in it's 6th year and "OMG!" "Gasp!" "surprise!" sales are petering out. It would appear, this holiday season would be an ideal time for a new release.

This is the first time nintendo has ever posted an annual loss. However, considering all the years of profit Nintendo is still sitting on a rather large war chest of 407,186 million yen or essentially $5 billion dollars and that is coming from the current financials.

Don't count Nintendo out yet.

RE: The 3DS is the problem.
By cscpianoman on 4/26/2012 8:53:07 PM , Rating: 2
BTW to put the war chest in perspective Apple has 10 billion in cash reserves.

RE: The 3DS is the problem.
By sorry dog on 5/5/2012 1:45:36 PM , Rating: 2
Now there's an idea...they could go all apple and use that money to sue everybody making game console because they probably have the patent on all non-joystick controllers... at least that's what Jobbies would do.

By Motoman on 4/26/2012 11:17:33 AM , Rating: 2
...the 3DS is a wonky bit of kit...I don't even want one.

And the Wii...well, market saturation. I was saying that a long time ago - they lit the world on fire with that thing, and at some point you just absolutely run out of people who are in the market but haven't bought one yet.

The Wii has had a great run...but it's well past it's growth period, and that's never coming back. Nintendo needs a compelling new console.

...and honestly I think they all need to give up on dedicated mobile gaming devices, period. Focus on all-inclusive mobile devices along the idea of the Playstation phone. Just make it not suck. There's no reason I can think of why someone can't design a single device that is *good* at phone, web, media, music, and video game usage.

RE: Blah
By The0ne on 4/26/2012 3:38:03 PM , Rating: 2
I don't know why it's so hard for people like Reclaimer77 to grasp the concept you've just outlined. Just looking at the numbers from year to year should mean something but I guess it doesn't. Maybe I think people like him want everyone on the planet including the dead and buried to have a Wii before admitting any type of success while regarding his own "precious" other consoles as the king although it lags behind.

Oh wait, I know, they think linearly! That's it. All they see is a straight line in a box of their own. Screw the millions that bought and love the console, their opinion definitely has researched backed-up credence to make them right every single time.

lamof. I just absolutely love it when a Wii topic comes out. We get to see Reclaimer in all his hellish form denouncing it on anything. Gotta love life and the idiots in it.

FIRST LOSS,,,and the doomsaying begins anew
By lenardo on 4/26/2012 12:34:20 PM , Rating: 2
first off wii U us coming in ~aug-nov which will boost sales (provided they do not do a blunder pricing wise)

second on wiiU's power....noone knows, there are VARIOUS rumor's estimates, that put the wiiU at anywhere from on par with the 360/ps3 to ~3x those consoles. personally we have 2 wii's in my house (3 kids) and they get played almost daily, we have well over 100 wii games. we have all the major first party releases.

bleeding money? after 4 years the wii tailed off due to the higher adoption rate of hd tv's, third party games for the wii were CRAP due to not one major 3rd party putting a top level team ON the platform, yet the wii has more 3rd party million sellers than the ps3.

now the wii U is coming. with the ability to -apparently- easily port major games to the system, and you have the ability to use the second screen for additional stuff, IF the wii u is ~3x as powerful and the ability to port is there (which is is- i have seen interviews that said it took a matter of days to get an AAA xbox360/ps3 game running on it well- it has unreal3 running it has crytek running, etc, it WILL get the major AAA titles and it will get the top teams on it (due to basically just hitting "compile to wiiu" button in ADDITION it will get all the exclusive first party games that nintendo makes

Zelda, Mario platformer, mario kart, brawl, etc etc most of which are games that sell TENS OF MILLIONS @ full price -

first party sales world wide, microsoft and sony would KILL to have sales of these numbers.

mario kart wii 32.4 million
new super mario bros wii 26 million
wiifit& wiifit+ 40 million
wiiplay 28 million
sports resort 30 million
brawl 10.8 million
galaxy 10.7 million
wii sports 76million (most of the sales were bundled with the wii)

games like these are ONLY going to be avail on the WiiU.. i am prediction $299.99-349.99(tops) for the new console with at a BARE MINIMUM the graphics should look as good as ps3/360 games.

now if they can get the nintendo network "right" it'll be golden, we'll find out more in early june to see if nintendo "got" it.

btw pikmin 3 is going to be a wiiu release window title :)

By Ramstark on 4/26/2012 12:48:28 PM , Rating: 2
I would absolutely buy that Pikmin 3 title....It was the most relaxing and zen experience I've had in gaming...

By Nortel on 4/26/2012 11:10:36 AM , Rating: 3
Nintendo has sat back and done nothing. The PS3 move and kinect are both vastly superior to the wii. The wii U got killed by the press and is still nowhere in sight. When Apple releases a game controller to work with the ipad + apple TV, all console makers will be shaking in their collective booties.

Smartphones have eaten Nintendo's cake. The smartest move for Nintendo would be to port and create iOS games, they would make a ton of cash without having to deal with physical media and consoles.

By WinstonSmith on 4/27/2012 10:15:07 AM , Rating: 2
"Many say that new devices, such as smartphones and tablets made by tech giants like Apple (iOS devices like iPhone and iPad) and Google (Android operating system), have placed a competitive burden on Nintendo."

That's it, exactly and there is no reversing that. Most people aren't serious enough gamers to bother with having to carry a dedicated gaming device. A smart phone will do.

By zodiacfml on 4/29/2012 4:38:06 AM , Rating: 2
I guess Nintendo is the one badly hit by the new devices. I think the success of Nintendo are coming from casual gamers which now are gaming in social networking sites and devices.

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