Nintendo Announces Q1 Results - Cuts Profit Forecast 82%

Jun 10, 2004
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Cygnus X-1 said:
Ah, by the way: these losses are not due to foreign exchange losses like last year. They did not sell enough to compensate general and administrative expenses!

So, last year there was an excuse, but now Nintendo is seriously in trouble. The last time something like that happened it was in 2004 Q1 with the Gamecube.
Their assets are diminishing, i.e. there is an intake of what they earned through last years.

So, the decision to lower the price of 3DS so much has sure something to du with the fact that they hope to compensate A LOT through the games.

Do "Selling, general and administrative expenses" include R&D costs?

And you absolutely right, foreign exchange losses are down from 70549 mio yen to 5065 mio yen!
 
Jul 7, 2010
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dvolovets said:
So that's a 3.23 attach rate for the 3DS... is that considered good at this point? I feel like it should be higher, considering the PSP-like audience that's currently the main market for the system...

What are you talking about? Early adopters? Or is the game selection different from the normal Nintendo offerings?
 
Aug 14, 2006
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Cygnus X-1 said:
Ah, by the way: these losses are not due to foreign exchange losses like last year. They did not sell enough to compensate general and administrative expenses!

So, last year there was an excuse, but now Nintendo is seriously in trouble. The last time something like that happened it was in 2004 Q1 with the Gamecube.
Their assets are diminishing, i.e. there is an intake of what they earned through last years.

So, the decision to lower the price of 3DS so much has sure something to du with the fact that they hope to compensate A LOT through the games.
That includes the astronomical costs of Wii U's R&D.
 
Apr 9, 2007
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Mihael Mello Keehl said:
nah but its their holiday for sure
I haven't seen anything outside of Zelda that I think will really sell... and I'm not sure Zelda carries the same weight any more. It's going to be Nintendo's biggest game and a big game this fall... but enough on its own to take the holiday period? I don't know if I believe that.

I don't think you're wrong, I just don't know if you're fully right.
 
Apr 30, 2009
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El_TigroX said:
I haven't seen anything outside of Zelda that I think will really sell... and I'm not sure Zelda carries the same weight any more. It's going to be Nintendo's biggest game and a big game this fall... but enough on its own to take the holiday period? I don't know if I believe that.

I don't think you're wrong, I just don't know if you're fully right.

The last two Mario Kart games sold like 50m units combined...
 

GCX

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Oct 22, 2007
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El_TigroX said:
I haven't seen anything outside of Zelda that I think will really sell... and I'm not sure Zelda carries the same weight any more. It's going to be Nintendo's biggest game and a big game this fall... but enough on its own to take the holiday period? I don't know if I believe that.

I don't think you're wrong, I just don't know if you're fully right.
There's Mario Kart. DS and Wii versions both sold over 20m copies.
 

BKK

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AniHawk said:
you know, i think the ps2 is going to remain the best-selling system of all-time. sony would have to absolutely kill it right now for the ds to even catch up, and that wouldn't happen until sometime in mid-late 2012.
Yeah, it probably won't even pass PS2 now, and even if it does it's unlikely to remain ahead.

Last Quarter;

NDS - 1.44/147.86
PS2 - 1.4/152.3
 

JGS

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Not surprising. They are still promoting Epic Mickey way too much. They had next to nothing this year for any of their products.

Iwata's explanations will be interesting because the will be pretty honest assessment.
 
Jan 31, 2009
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Ouch. Price cut for the 3DS was the right thing to do. I still think the Wii U will be a flop.

I don't like the Wii either, but at least when I saw that first demo of Wii Sports I said "This looks fun, I'm gonna buy one and so is everyone else!" 5 years later I've yet to finish a game on the Wii.
 

GCX

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M.I.S. said:
How well did Animal Crossing DS do as compared to Animal Crossing Wii?
I'm not sure what that has to do with anything. That's like saying "I wouldn't call Uncharted 3 a big holiday game because there's a slight change it won't do well".

No one knows how much Mario Kart 3DS will end up selling but everyone knows its sales potential is astronomical.
 
Jun 7, 2011
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Kagari said:
No wonder they cut the 3DS price.
If those forecasts are their goals, I agree. However, I still don't see how they'll hit the software target of 70 million over the next three quarters when the first quarter was 4.5M.

You would need a quarter over quarter growth rate of 150%!
 
Mar 13, 2009
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PooBone said:
Ouch. Price cut for the 3DS was the right thing to do. I still think the Wii U will be a flop.
Way too early for Wii U (wonder if they'll change that name? Mario Kart 7, Super Mario 3D Land? Maybe not!)

That reminds me, this is the first time since the SNES that Nintendo have shown both the console and controller at the same time at it's unveiling.
 
Mar 7, 2007
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Nuclear Muffin said:
That includes the astronomical costs of Wii U's R&D.
No use finding excuses. A company always has to take into account R&D. Like Nestlé, Hoffman La Roche, Novartis, ABB or every other company.

Nintendo misjudged the situation: they did not realize the DS was slowly diminishing its sales; they didn't realize Wii was collapsing because of lack of third party games AND their own games; they didn't realize PSP was returning big in Japan; they didn't realize Kinect would have been successful; they didn't realize games for iPhone and Android were becoming more and more important; they didn't understood the power of Steam.

Though they did something right: 3D without glasses is a major distinction factor from every other product. Price was too high though and line-up was catastrophic. They corrected the former, which will give at least the change of 3DS to take over the original DS. But in order to explode like DS, they need to bring to the system new IP that cannot be found on any other tablet or smartphone device. Something completely new.

The big drop of 3DS price is encouraging: Nintendo understood that there was a problem quite fast. I mean: I would have waited till PSP Vita was out. The fact they dropped the price so much and so early is the sign they are moving their asses from the lazy modality.
Since the pressure is not going away anytime soon, I expect them to drastically increase their efficiency from now on.
 
Oct 23, 2009
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_Alkaline_ said:
Do your posts ever have any kind of substance other than one word/sentence quips that try to be provocative but fail miserably?
Actually he's right, they made something that didn't appeal to the market and made every move to be sure to get in this situation.
seriously they only have themselves to blame.
Seriously they release jackshit on Wii and they expect the shunned market to stay there?
They didn't follow up on WSR or NSMBW but when Galaxy doesn't move anything we get 2 new projects in the same vein.
They striked gold and didn't know what the hell they were doing, serves them right.
 
Jun 10, 2004
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El_TigroX said:
I haven't seen anything outside of Zelda that I think will really sell... and I'm not sure Zelda carries the same weight any more. It's going to be Nintendo's biggest game and a big game this fall... but enough on its own to take the holiday period? I don't know if I believe that.

I don't think you're wrong, I just don't know if you're fully right.
Nintendo will supposedly start huge marketing efforts in November for both Zelda (25th) and Mario. Mario Kart 7 was supposed to be released in October already, there must've been some development issues or a new strategic decision... (I assume they had trouble with the online mode).
 
Mar 13, 2009
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GCX said:
I'm not sure what that has to do with anything. That's like saying "I wouldn't call Uncharted 3 a big holiday game because there's a slight change it won't do well".

No one knows how much Mario Kart 3DS will end up selling but everyone knows its sales potential is astronomical.
I meant that Animal Crossing Wii was a relative dud as compared to the huge sales of Animal Crossing DS. That one title of the same franchise on one platform will not necessarily translate to the same success on a different platform.

Mario Kart is Nintendo's largest franchise ever in terms of unit sales but I'm not yet convinced that casual players won't just look at it on store shelves, realise they've already played it on Wii and DS, shrug their shoulders and move on.

Many casuals gave 3DS the same reaction. They already have a DS/i/XL, looked at 3DS in store shelves, shrugged their shoulders and moved on. Whether that perception will change, well, we'll see.
 
Aug 14, 2006
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Cygnus X-1 said:
No use finding excuses. A company always has to take into account R&D. Like Nestlé, Hoffman La Roche, Novartis, ABB or every other company.

Nintendo misjudged the situation: they did not realize the DS was slowly diminishing its sales; they didn't realize Wii was collapsing because of lack of third party games AND their own games; they didn't realize PSP was returning big in Japan; they didn't realize Kinect would have been successful; they didn't realize games for iPhone and Android were becoming more and more important; they didn't understood the power of Steam.

Though they did something right: 3D without glasses is a major distinction factor from every other product. Price was too high though and line-up was catastrophic. They corrected the former, which will give at least the change of 3DS to take over the original DS. But in order to explode like DS, they need to bring to the system new IP that cannot be found on any other tablet or smartphone device. Something completely new.

The big drop of 3DS price is encouraging: Nintendo understood that there was a problem quite fast. I mean: I would have waited till PSP Vita was out. The fact they dropped the price so much and so early is the sign they are moving their asses from the lazy modality.
Since the pressure is not going away anytime soon, I expect them to drastically increase their efficiency from now on.
Yes it was a misjudgment, but this loss is not a sign of long term problems because the R&D costs will now be mostly sunk.

Personally, I think that this massive pricedrop is a mistake and an overreaction (sure, a price drop for the holidays would've gone well, but this drop is too large). As for the lineup, how is it any worse than the DS' first year? Hell that didn't get a Mario game till about 1.5 years after launch.

Remember, the DS didn't explode until around 1.5 years after launch (with the 1,2,3,4 punch of the DS Lite, a price drop, the release of Brain Age and NSMB and the combined library of DS games so far).

The 3DS is still tracking ahead of the original DS (ignoring the holiday sales for the DS).
 
Nuclear Muffin said:
Yes it was a misjudgment, but this loss is not a sign of long term problems because the R&D costs will now be mostly sunk.

Personally, I think that this massive pricedrop is a mistake and an overreaction (sure, a price drop for the holidays would've gone well, but this drop is too large). As for the lineup, how is it any worse than the DS' first year? Hell that didn't get a Mario game till about 1.5 years after launch.

Remember, the DS didn't explode until around 1.5 years after launch (with the 1,2,3,4 punch of the DS Lite, a price drop, the release of Brain Age and NSMB and the combined library of DS games so far)
I thought DS launched with Super Mario 64 DS?
 
Aug 14, 2006
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Dedication Through Light said:
I thought DS launched with Super Mario 64 DS?
I was referring to NSMB. Super Mario 64 DS didn't manage to carry the DS sales like NSMB did (or Super Mario 3D Land may be able to)

It's more like OoT 3D than SM3DL.


Shiggy said:
Nintendo will supposedly start huge marketing efforts in November for both Zelda (25th) and Mario. Mario Kart 7 was supposed to be released in October already, there must've been some development issues or a new strategic decision... (I assume they had trouble with the online mode).
Where did you hear this? If anything I would've imagined that SM3DL is the one that is being released earlier than expected!
 
Jun 7, 2011
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Tron 2.0 said:
And can someone explain to me the difference between operating loss, ordinary loss and net loss?
Not sure if anyone answered but operating loss is basically total revenue minus cost of doing business, before taxes,interest, and amoritization.

Net loss is after you include taxes, interest, and amoritization.

Ordinary loss I would have to see the context but my guess something that was expected (not a one time loss hit from a plant catching fire for example).
 

GCX

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M.I.S. said:
I meant that Animal Crossing Wii was a relative dud as compared to the huge sales of Animal Crossing DS. That one title of the same franchise on one platform will not necessarily translate to the same success on a different platform.

Mario Kart is Nintendo's largest franchise ever in terms of unit sales but I'm not yet convinced that casual players won't just look at it on store shelves, realise they've already played it on Wii and DS, shrug their shoulders and move on.

Many casuals gave 3DS the same reaction. They already have a DS/i/XL, looked at 3DS in store shelves, shrugged their shoulders and moved on. Whether that perception will change, well, we'll see.
Anything's possible and I'm not saying that couldn't happen.

Mario Kart has been one of the best-selling titles on ALL of Nintendo's consoles since SNES though and for that reason alone they will treat it as one of their biggest releases this year. Whether MK can sell consoles on its own remains to be seen.
 
Mar 30, 2007
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Wow at those sales drops. The DS, I understand, the 3DS hit. However, the Wii sales drops are brutal, especially since it's only $150 now.

I never thought they'd lower the 3DS's price so much so soon, but it looks like it's out of necessity.
 
Mar 30, 2007
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Cygnus X-1 said:
The big drop of 3DS price is encouraging: Nintendo understood that there was a problem quite fast.
It was a very professional move, no BS PR statement about how the 3DS is some amazing item that people will start to want, etc. They just lowered the price, that's what people want.

People also want games. That should be fixed this holiday season. Mario Kart will be a big system seller in the US, not sure about Japan.

GCX said:
I thought they already announced Pokemon for Android.
Not developed by Nintendo.
 
Mar 7, 2007
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ciaossu said:
People also want games. That should be fixed this holiday season. Mario Kart will be a big system seller in the US, not sure about Japan.
Sure, that's what I'm saying too. This price cut shall be the first of many measures that point out to revitalize the 3DS. Software will be a large part of this Nintendo-Marshall Plan.
They have to work more on new IPs. Period. Something like Angry Birds who can cater the attention of the casual market, like Brain Training did.
 
Mar 7, 2007
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GuiltySpank said:
So the party is over for Nintendo and the casuals have left in droves. Let this be a lesson to MS and Sony that the waggle fad can only take you so far.
They did a lot of money on these fads though. Much more than in any time o their history. And their profits propelled to the skies as never seen before.

Thus it was not a bad choice and in my opinion Nintendo should forget about hardcore and keep their brains focussed on the casual market that made Wii and DS'f fortunes.
 

BKK

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electroplankton said:
Maybe when DSi will be at $99.
And put them back to square one with a big price differential between 3DS and DSi again? 3DS at $169 is supposed to replace DSi at $169, they're effectively killing off DSi.
 
Mar 30, 2007
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Cygnus X-1 said:
Sure, that's what I'm saying too. This price cut shall be the first of many measures that point out to revitalize the 3DS. Software will be a large part of this Nintendo-Marshall Plan.
They have to work more on new IPs. Period. Something like Angry Birds who can cater the attention of the casual market, like Brain Training did.
That's a good point. I tend to forget about Brain Training since it didn't interest me, but the casual market was huge for the DS so that's an essential component.

I remember an old lady who cut hair at a local barbershop has a DS with Animal Crossing, it was probably the first video game she ever played, but she seemed to like it.
 
Sep 22, 2010
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Cygnus X-1 said:
They did a lot of money on these fads though. Much more than in any time o their history. And their profits propelled to the skies as never seen before.

Thus it was not a bad choice and in my opinion Nintendo should forget about hardcore and keep their brains focussed on the casual market that made Wii and DS'f fortunes.
When all is said and done and you combine losses with the profits, would it still have been worth it?
 
Jan 23, 2009
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GuiltySpank said:
So the party is over for Nintendo and the casuals have left in droves. Let this be a lesson to MS and Sony that the waggle fad can only take you so far.
I can't wait the day when all games can be played normally again, using traditional controller. In the meantime, let Nintendo eat their own gimmicks
 
May 12, 2011
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big_z said:
Nintendo needs to make a new handheld and blow off the 3ds as the last version of the ds revisions. They also need to kill the wiiU as it's a rushed unfocused mess and try again.


Every now and then nintendo gets lucky and strikes lighting but they still haven't figured out how to ride it.
And you'll still troll everyone due to having no other reason to come here.
 

Plinko

Wildcard berths that can't beat teams without a winning record should have homefield advantage
Jul 31, 2007
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Cygnus X-1 said:
Sure, that's what I'm saying too. This price cut shall be the first of many measures that point out to revitalize the 3DS. Software will be a large part of this Nintendo-Marshall Plan.
They have to work more on new IPs. Period. Something like Angry Birds who can cater the attention of the casual market, like Brain Training did.
I'll never get this argument. I'd love to see new IPs but this generation shows they just don't sell anywhere near as well as sequels do.
 

Plinko

Wildcard berths that can't beat teams without a winning record should have homefield advantage
Jul 31, 2007
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GuiltySpank said:
When all is said and done and you combine losses with the profits, would it still have been worth it?
Am I missing the sarcasm here or are you being serious? 5 years of gangbusters sales against a couple quarters of loss. Surely you jest.
 
Jul 6, 2008
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Relative underperformance looks like a massacre thanks to the Yen. Why the hell are people buying yen anyway? I think Japan is just about as solvent as Italy. Worse Dept / GDP and an aging population...
 
Sep 22, 2010
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Plinko said:
Am I missing the sarcasm here or are you being serious? 5 years of gangbusters sales against a couple quarters of loss. Surely you jest.
I said when all is said and done. Do you expect Wii to increase in sales again? I don't think so. This is the start of a steady decline for the Wii and there are many more losses to come.
 
Nintendo's primary problem is, in my opinion, Apple, not Sony or Microsoft.

Many people have suggested that Nintendo's casual approach would put them in a tight spot the next generation -- implying that "hardcore" gamers are the ones you can really count on, and oh boy Nintendo is going to regret ever pissing them off. Casual gamers would leave gaming once the novelty wore off. That was the argument anyway.

I dismissed this, because I did not believe casual gamers were going away. And they haven't -- casual gaming is still growing rapidly, with Facebook and iPhone games and iPad games and so forth. The problem isn't that Nintendo focused on casual gaming, which are still the most lucrative and fastest growing segment of the gaming population. Instead, the problem is that they've been outcasual-ed, by a company even more focused on convenience and ease of use, providing even cheaper and even simpler games.

Another way to put this is like this: Nintendo flanked Sony and Microsoft with the Wii. Flanking an opponent is a very good strategy, and it worked for Nintendo for a long time. The problem is that Apple proceeded to flank them. Extending this analogy even further, being flanked while you are flanking is perhaps the most vulnerable position to find oneself in. You quickly go from "flanking your opponent" to "sandwhiched in between your old opponent and your new one."

I'm not suggesting Nintendo cannot ever get out of this. I'm just explaining why I now agree that Nintendo is in a highly vulnerable position.