SinCityAssassin
Member
The spin's pretty good there with the whole "biggest drop in 16 years" considering Nintendo stock literally went up 120% beforehand.
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Bloomberg: Nintendo Market Value Passes Sony on Pokemon Go Frenzy
- Thread starter SinCityAssassin
- Start date
The spin's pretty good there with the whole "biggest drop in 16 years" considering Nintendo stock literally went up 120% beforehand.
D.Lo
Member
Seems you're right.
Nintendo gets licencing fees from all Pokemon name usage outside of their partial ownership of the IP. And yes some of the profits go to companies Nintendo part owns, so they don't get liquid dollars from those flows, but that increases the value of those companies and thus the value of Nintendo's stakes in them. If they sell their stake in Niantic later it will be worth a lot more than it was when they bought it, hence they have potential gained just through that investment. Indirect profit. That should still push Nintendo's value up.
I would assume everybody would understand profits from an app to be referring to profits after the Apple/Google cut.
Supply sources and working.
While they share the ownership of the IP as a whole, Nintendo has 100% ownership of the Pokemon name, logo, and all character names and designs.
Lol yep. So they've only gained ~107% averaged out over the week now, what a failure.
Herb Alpert
Banned
These reactions were oh so expected lol
Boombloxer
Member
Not really. Their IP catalog is much stronger.
There really is no need for them to actually make hardware. I understand why they do, but the factors that govern the need are not the same as a few years ago.
They're going after a segment now owned by Apple and Google, when they couldn't even handle Sony and MS.
That is weird, largely because this has been a success for them. Much more than their failing console and their hold on a shrinking handheld market.
D.Lo
Member
In terms of profit, Nintendo has brutally slain Sony and Microsoft in the games market over the last 15 years. The Wii was by far the most profitable console of all time, DS the second, whereas PS3 and 360 lost $4 billion each.
They'd need to significantly downsize so we'd get less experimental games and just more samey games.
It's not a good idea
The Maverick
Member
This is already the Nintendo we have today. I can live without Hyrule Warriors and Metroid Blast Ball. I personally hope Nintendo views this success as a green light to leverage their IP on other platforms, such as PC and mobile.
MisterHero
Super Member
Nintendo needs their own hardware. Too weeks on mobile and users won't shut up about how Nintendo only gets percentages of the income.
The point makes itself.
The point makes itself.
Mass_Pincup
Banned
I would think that the PS2 was on top no?
D.Lo
Member
PS3 completely erased all PS1+PS2 profits ever gained, or near enough.
get out
Plinko
Wildcard berths that can't beat teams without a winning record should have homefield advantage
That game is fantastic.
It´s not about Hyrule Warriors and Metroid Blast Ball.
First they´ll close Retro and Monolith because these studios are too expensive and huge risk factors.
Second Nintendo will fund less games. You won´t see W101, Bayonetta or another Altus exclusive.
Third EAD/EPD will massivly shrink and be more profit orientied. Want to play a new Metroid or F-Zero? Good luck
Mass_Pincup
Banned
Sure but I was talking about your claim of the Wii being the most profitable console of all time.
It really isn't the Nintendo we have today. Look back at all the titles they have published for 3DS and Wii U and tell me that it's the case, that they haven't financed experimental, risky or niche stuff.
If you manage to do that, then you're a liar.
PS2 also lost money it's first full year. SCE's profits during PS2's peak were around or below Nintendo with GBA and GC, and a small fraction of what Nintendo was pulling in with DS and Wii.
Don't confuse userbase with profitability. PS1 likely made more money than PS2 did despite selling less. Even GBA+GC (only ~100m userbase) made more than PS2. Wii and DS each destroyed PS2 profit wise.
Mass_Pincup
Banned
PS2 also lost money it's first full year. SCE's profits during PS2's peak were around or below Nintendo with GBA and GC, and a small fraction of what Nintendo was pulling in with DS and Wii.
Don't confuse userbase with profitability. PS1 likely made more money than PS2 did despite selling less. Even GBA+GC (only ~100m userbase) made more than PS2. Wii and DS each destroyed PS2 profit wise.
Thanks for the insight.
Nintendo seems to be far and away the best at managing it's expenses from R&D to game budget.
Sir_Crocodile
Member
nm
test_account
XP-39C²
"Nintendo drops ~$5 billion in value in one day!" (not an actual quote, but easy to make sensational headlines. Also shows that market value cap is really fragile, like "omg, it increased $5 billion in one day" and "omg, it dropped $5 billion on one day).
SinCityAssassin
Member
It doesn't help that a lot of people are profiting AHEAD of the financials next week, just in case Nintendo does something the market doesn't really like.
I really can't see Nintendo ever making games for PCs. Look how hard it was to get them to even consider mobile and mobile games are pretty much completely different than other platforms but for years they said it would dilute the value of their hardware.
Shareholders kind of forced their hand with mobile but I don't see that happening with any other platform unless something brand new comes along again.
KillerMan91
Member
X360 didn't really lose money for MS. Gaming division of MS had nice profits during the latter half of last gen (thanks to Kinect) and those erased the losses made during early gen.
test_account
XP-39C²
True. Just ment to say that the market value cap can change big time quickly, but that doesnt necessarily affects the company directly, at least not short term.
Tbh it's always been amazing that Nintendo has been able to stay around this long without diversifying (much (until now) ) against competitors that have billions of dollars more assets and a hundred other revenue streams to fall back on, especially when gaming has always been such a volatile market that requires incredible feats of marketing, design, game development, R&D, high output rates, online, adoption of new technologies, and much more to even stay competitive.
Not quite, they never broke even (mostly due the the RRoD cases costing Microsoft billions of dollars). Many within Microsoft were calling for the Xbox One to never have been made, or for the Xbox division to be sold off.
KillerMan91
Member
Well nevertheless X360 didn't lose anywhere near 4 billion. For example during FY2011 Entertainment Division made 1.32 billion of profit and it even had loss leading Windows Phone in it so X360 probably made even more than that 1.32 billion during that year. Sony of course lost billions with PS3 but on the other hand by keeping PS3 alive they were able to launch PS4 to the market where PlayStation brand still had decent amount of mindshare and are now collecting fruits of that. PS4 is making more money for Sony than PS2 did.
Calamari41
41 > 38
That $35 million is revenue split among all of the parties with a stake, of which Nintendo gets maybe ~30%. Pure revenue for Sun and Moon, assuming a reasonable if not lowball 12 million copies sold, would be $480 million dollars, with a much better split for Nintendo. $35 million in two weeks is great, but Sun/Moon can easily more than double that over the launch weekend alone by selling the couple of million copies that it is bound to sell right off the bat. Even if Pokemon Go does the billion dollars per year in business that it has been predicted to do, Nintendo's cut of that would be smaller than the income from the lifetime sales of a standard Pokemon release (depending on what kind of cut Nintendo actually gets from each).
Pokemon Go is an unmitigated success and unequivocal win for Nintendo in every regard, but unless Go maintains these levels for a very long time (and let's hope it does), the mainline Pokemon games will be larger pure revenue generators for Nintendo.
Especially if they can harness the immense amount of goodwill and mindshare that's being thrown at them right now. Using this current phenomenon to increase sales of their systems and games is where Nintendo will really win here.
$35 million, cut out 1/3 by Google/Apple and then only part of which is going to affect Nintendo revenue. 70% seems absurd to me, but even assuming that, it's 1.2 million a day. Add in some revenue from Japan (third largest market, add 33%) and arrive at $1.6 million. This is the peak, assuming that, it's $582 million for the year. Pokemon X/Y sold 14.7 million copies at $40 a piece. A publisher makes about 56% on physical sales. So pretending all the copies were physical that's $329 million.
Here's where the prediction starts: So best case scenario where PokemonGO doesn't see a dip at all over the course of the year in revenue and that Nintendo pulls in 70% of the revenue from the game, then yes it's a big hit. Realistically they hit 33% of the revenue which is actually $210 million on the year if it maintains $2.5 million a day for the rest of the year. Most mobile games at the top of the chart (generous here) settle out around a million, I'd wager Nintendo can do better, maybe an average of $1.5 million. That's $125 million. With the hype generated by GO and larger install base since the release of X/Y the 3DS Sun/Moon will probably make 3-4 times that. (Not to mention they invested $30 million in Niantic with Google, split unknown).
Edit: And besides all that the entire point of this dialogue was that the stock went up by BILLIONS. PokemonGO isn't the cause of that and the future viability of Nintendo in mobile is. The price for Japan release of GO and NX hype is already baked into the valuation the market has placed on Nintendo. It's going to settle and not many investors are going to think its worth more until they prove PokemonGO isn't a flash in the pan. Hence the "Hold" rating by many analysts.
Boombloxer
Member
No, that was the PS2. Aside from the Wii, they have lost every generation since the PS1 and have not been a market leader for some time now. Profit is nice, but at the expense of diminished sales, relevance and mindshare.
They would need to downsize hardware folks, yes. But would you like to bet that their more experiemental titles wouldn't find a home on PC?
And PS4 is back to their normal position. Doesn't change my point.
Dirk Benedict
Member
Look above. Wii destroyed PS2 in terms of profit.
Nintendo's had 7 market leading platforms, Sony's had 3, Microsoft 0.
That's not how percentages work. A 13% decrease after a 120% increase would be about a 91% gain over the base price.
D.Lo
Member
True that, I just stupidly/lazily assumed decrease of the gains. And even then it's not quite right.
Fuck I should of put money in but who would of thought the surge would be that bloody high! Crazy
OrbitalBeard
Member
Trying to wrap my head around this.
SinCityAssassin
Member
He's saying whatever profit advantage Nintendo had over Sony does not adequately replace the mindspace they've lost for how much more the PS1/PS2 sold.
OrbitalBeard
Member
Oh, I know what he was saying. But a corporation's long-term strategy is almost always going to be driven by profitability, so I still find it to be an odd statement.
Not that mindshare and increased revenues aren't important, but profit isn't simply "nice" either.
Which is stupid as by having Wii Profit, Nintendo actually had chances to try even more to reach more marketshare even if they just had Wii U failure.
Getting PS3 failure is never good idea even if you retained ur market shares here as business 101 will tell you that losing money is never a good idea.
OrbitalBeard
Member
It can be in the short-term if it's part of a long-term strategy that eventually leads to increased profits.
Can be really hard to explain to investors though!
I don't think there is any single Business 101 book who will teach me that it is okay for me to delete my 1 decade profit for possible profit though. O_O
Not to mentioned, rather than investor, i don't any CEO will had any right mind to approve this kind of business plan lol.
OrbitalBeard
Member
I think you highlight why it's not good idea to lose money in a fiscal year regardless of reason. Investors don't care about those long-term strategy if they're not profiting from their investments right now.
Yup. Which why he is called Krazyyy Ken lol. He don't operate under normal human logic lol.^_^
Man o man Sony. They should feel happy that PS4 is doing that well there. If not, we are going to see Sony going to be more known as insurance company rather than it is now lol.
OrbitalBeard
Member
Good point. Certain divisions can purposely lose money in the short-term, but it's not a good idea for an entire company to end up in the red, even if it could translate into a much larger bottom line in the future.
When you go public, you had responsibilities towards investors to bring profit so, there is that lol.
fabricated backlash
Member
I think the potential Push to their core Business will be the better Barometer as to how successful their mobile Venture is.
Which was always Nintendos Plan, to get more mindshare and drive their core Business by increasing IP awareness.
And mobile is a Venue that actually makes them money while doing so.