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Nintendo hopes the Wii U will help with profits

Nintendo cut its fiscal-year profit outlook by over 50 percent in its latest earnings report -- and some of the other financial numbers aren't looking too swift, either.
For the six months ended September 30, Nintendo reported a net loss of Y27.99 ($350 million USD), which isn't as bad as the Y70.27 billion ($876 million USD) net loss the video game company reported a year ago. However, revenue took a tumble by 6.8 percent to Y200.9 billion ($2.6 billion USD) during the first half of the fiscal year. 
Nintendo doesn't report its earnings on a quarterly basis. 
For the 2013 fiscal year, Nintendo has significantly cut its profit outlook from Y20 billion ($250 million USD) to Y6 billion ($75 million USD). 
Nintendo cited weak 3DS sales for the slash in profit outlook for the fiscal year 2013. The company expected to sell 17.5 million 3DS units and have only sold 5.06 million in the first half, which makes the 17 million look a bit out of reach.
Other Nintendo hardware has declined as well, such as the Wii (1.32 million units sold in the first half of 2012) and the original DS (980,000 unit sales during the same time period). However, software sales seem to be doing well -- it reached 64.45 million sales during the first half. Wii sales may pick up too, since Nintendo just cut the price down to $129.99.
Nintendo CEO Satoru Iwata recognized that cheap gaming on mobile devices like smartphones and tablets has put the company in a difficult place. While devices like the Nintendo 3DS are also mobile, it's much more convenient to carry one device that makes calls, sends texts, accesses the Internet and offers games instead of just one gadget that only offers games. Despite this challenge, Iwata said that Nintendo is sticking with its traditional gaming machines and titles instead of shifting to other methods.
"Certainly, a new competitive environment has been born," said Iwata. "But we have no plans to use our valuable resources for smart devices." 
A lot of Nintendo's gaming future depends on the launch of the Wii U right now, which is the successor to the original Wii console. The Wii U, which is only weeks from release, offers a new gaming experience that Nintendo hopes will draw customers in a different way from smart devices.
The Wii U features a 6.2-inch GamePad controller, 1080p high-definition graphics and 2GB of memory. Nintendo hopes to 5.5 million Wii Us and 24 million Wii U software titles by the end of March 2013. 
The Wii U will be released on November 18 in the U.S., and customers can choose the basic model for $299.99 USD or the premium model for $349.99 USD. 

Source: Nintendo [PDF]

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Why consoles?
By melgross on 10/24/2012 6:47:26 PM , Rating: 2
A lot of people bought consoles over the decades because there was no way to play decent games in the living room otherwise. The computer was usually in the bedroom, or sometimes in the kitchen. They also had small screens.

Handheld games were pretty primitive, and didn't offer much in the way of gameplay.

But that changed a lot. Smartphones offer a lot of pretty good games. Good enough to lure some people away from consoles, particularly since they have their phones wherever they go. Even though the games aren't as sophisticated, they are much closer than they used to be. Handheld game machines? A lost category. Sales are dropping like a stone.

In addition, tablets offer a lot of what consoles offer. Again, not everything, but enough so that people are buying those games in the tens of millions. As we get more controllers for tablets, the games will eventually equal those in consoles, and will become consoles. That's already happening, as games can be played on the tablet but sent to the Tv as a consoles does.

And you can play them anywhere without the Tv or power connection. The screens are big enough at 10".

It might just take a couple more years. I read somewhere in a gaming magazine that the iPad 3 was already as powerful as an average of the PS2 and PS3. The iPad 4, just announced, and twice as powerful, could be as powerful as the PS3 already, with higher resolution.

The handwriting is on the wall for all consoles.

RE: Why consoles?
By augiem on 10/25/2012 3:26:46 AM , Rating: 2
I read somewhere in a gaming magazine that the iPad 3 was already as powerful as an average of the PS2 and PS3

Not true.

RE: Why consoles?
By TakinYourPoints on 10/25/2012 3:40:32 AM , Rating: 2
The problem with that argument is that it doesn't take setting or physical controls into account. Now, you can use a wireless gamepad to interface with an iPad, and you can push iPad to display video to a TV via an AppleTV, but it doesn't mean that developers won't continue to focus on the main interface which is touch and gyro.

There are excellent games on the iPad, but the best of them aren't the traditional shooter or third person action game that you find on a console. They're different genres like board games, RPGs, tactics, and strategy games, genres that play to the strengths of the touch interface.

Every console game will be designed around a gamepad and a TV. The interface will drive the types of games designed, which is why tablets, as capable as they are becoming, won't replace consoles anytime soon. Horsepower alone won't do it, software (which is purpose built for the input method and the display) also matters.

"If you look at the last five years, if you look at what major innovations have occurred in computing technology, every single one of them came from AMD. Not a single innovation came from Intel." -- AMD CEO Hector Ruiz in 2007

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