backtop


Print 41 comment(s) - last by sorry dog.. on May 5 at 1:45 PM


  (Source: billmudron.com)
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



Comments     Threshold


This article is over a month old, voting and posting comments is disabled

RE: Time For a Drastic Change!
By Reclaimer77 on 4/26/2012 12:52:28 PM , Rating: -1
Console sales yes, but look at the game sales! That's where the moneys at, and the Wii had the worst game sales for every month, quarter, and year during that 7 year period. And no tayb, we can't honestly include bundled games as "sales".

The biggest problem with the Wii is that the best games for it came with console lol. Exclusive titles that you would rush out and buy? Practically none.

The Wii is over man.. it's over.


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
quote:
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.


"I'm an Internet expert too. It's all right to wire the industrial zone only, but there are many problems if other regions of the North are wired." -- North Korean Supreme Commander Kim Jong-il














botimage
Copyright 2014 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki