Nintendo's Profit-making Machines Slowing Down
Source: Tom's Guide US | Keywords: nintendo, profit, wii, dsi, sales | Themes: Digital Entertainment, Business
Still making money, just not as much as before.
Nintendo is still the most successful platform holder of this generation, but it seems that things are finally slowing down for the big N three years after the launch of the Wii.
Nintendo had to give investors bad news for the first time in six years due to the declining demand for the Wii. Of course, the bad news is characterized that way in light of all the positive results the company has had over the last few years. Nintendo still managed to turn a profit in the first fiscal half of 69.49 billion yen ($772 million).
This year's first half results are down considerably, 52 percent, compared to the same period from last year at 144.83 billion yen, according to the AP.
For the first time in six years, Nintendo has had to lower its full fiscal year profit – now down to 230 million yen as opposed to its original 300 million yen.
In September, Nintendo cut the price of the Wii from $250 down to $200 in late September. No doubt that the $50 price cut hurt Nintendo's profit margin, but the company clearly hopes to make it up with increased volume this holiday season.
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Figures the public finally learns that they make inferior hardware. They have turned into the "Apple Computer Inc." of the console industry.
Oh, cry more. They "only" made USD$772 million? There are millions of people that would kill to make a fraction of a percent of that amount of money.
Man you guys are ridiculous. Grow up.
3 years is just about the right time to release a 2nd Gen Wii or launch a new product of some sort. You can't tell me they have been sitting on their hands this whole time, right?
Um $772mil for the entire company around the world.
Who said they cried? They are still smiling.
Anyway, $50 price cut is not enough. Others are doing $100.
What were they thinking?
Well played from Nintendo and yeah they did make shitloads of money the past few years. The drop was huge but the profit is also still too much. They dont loose money, they just dont make the same extreme amount of it as they did till before. Anyhow, i think this kind of news will be too interesting only for the shareholders and ones that make money straight from the source and not the rest of us.
They make a lot of money because they don't spend a lot on R&D. Look how many good 1st party are coming out lately. It is laughable. Worst console out right now.
Figures the public finally learns that they make inferior hardware. They have turned into the "Apple Computer Inc." of the console industry.
Seriously--give it a rest. It may not be the best hardware, but its what 90% of consumers want. The businesspeople at both Apple and Nintendo know what they are doing--and are very good at it.
I think it was pretty obvious that the Wii sold on the gimmick of motion controls. It was never going to have any lasting power. I actually heard rumors that there is a Wii2 in the works with high def and other things. A new system right now would be terrible for the consumer that spent money on the original Wii. And a lack of serious games is terrible right now for the Wii. Its not looking too good.
Monica S
Los Angeles Computer Repair
http://www.sebecomputercare.com
Seriously--give it a rest. It may not be the best hardware, but its what 90% of consumers want. The businesspeople at both Apple and Nintendo know what they are doing--and are very good at it.
90% of my friends play xbox360 and ps3. The other 10% is just those who have all 3 systems.
Reading this article and the following comments, Nintendo must be going under!
Seriously--give it a rest. It may not be the best hardware, but its what 90% of consumers want. The businesspeople at both Apple and Nintendo know what they are doing--and are very good at it.
Agree. The wii wasn't meant to have cutting edge hardware of it time (unlike the ps3). The wii was meant to be an economical interactive console.
All Nintendo did was put in already proven, reliable tech into the wii and sold it.
As deadlockedworld said, Nintendo knew what it was doing when they released the wii. They took a gamble with it and the consumer respond positive to the change.
Now if you want to talk about "inferior hardware" then we should really talk about all the game consoles.Due to in today's stander of computers, all of the game systems are old tech and needs to be replaced.
"3 years is just about the right time to release a 2nd Gen Wii or launch a new product of some sort. You can't tell me they have been sitting on their hands this whole time, right?"
"They make a lot of money because they don't spend a lot on R&D. Look how many good 1st party are coming out lately. It is laughable. Worst console out right now."
if you had a new console in the works and great ideas for games...where do you think the games should go...yeah, Nintendo spends more making it's own quality games "Wii Sports" then Microsoft or Sony does...they definitely spend on R&D on the software side...I have to same those renderings in super smash where some of the most beautiful eye candy.
I'm sure Nintendo got a slew of ideas that'll come with the new console. We will have to wait and see if they catch on, seems like the Christmas with Gamecube dropping with the Zelda masterdisc.
Guys, we might already know that they don't use bleedin'-edge hardware. But we're talking here about the first loss after six years (in which 3 of those 6 years, the Wii has been the main reason for the growing-up margin). But, I'm pretty sure they must have something up on their sleeves.
I think it was pretty obvious that the Wii sold on the gimmick of motion controls.
You're partially right, there have been previous attempts of unique gimmick, but as a standalone, they usually fail. Let's focus on the main point that the motion sensor features was nicely paired with some entertaining games. Overall, I have my two cents about the Wii.
I fail to see the Wii useful as a one player console. The real entertaining factor shines when you play this console with a group of people. Because, as some of you might have noticed, Wii's game portfolio packs a lot of multiplayer games. There are only a few one-player titles, and they happen to be not so famous. Besides, the wii's target consumer is mainly oriented to groups, socializeing and family. Heck , i have to admit that I find the console like a Gamecube on steroids, but let's not forget how fun it gets when it is played with a lot of people.
I love how people like Rooket still believe that superior hardware = better/funner games.
I love how people like Rooket still believe that superior hardware = better/funner games.
Nintendo follows a business model of "Make games fun that people want to play" they are not a company of creating your ultimate HTPC that streamlines your digital lifestyle and even schedules your coffee maker in the morning. Nor are they in the business of super computer graphics that run crysis on full settings with blow away visual graphics. Nintendo says, Hey lets make a game like Tetris fun. There's people who play games because of their graphic (DOOM3, Crysis, Left 4 Dead, any of TOMs benchmarking games) then there's people who play games because they are fun (Tetris, Zuma, Braid, Pac-Man, Pong!) nintendo caters to the later while groups like Xbox and PS3 cater to the former.
Nintendo is doing it right. I'll admit i was scared of nintendo after their lackluster gamecube console when everyone was raving on the Xbox and PS2, but I admit the Wii really hits it out of the ballpark with the "fun factor" that I actually bought "Force Unleashed" for the PS3 for the "graphics" and for the "Wii" mainly because playing it on the Wii is just so darn fun vs the uber eye candy of the PS3.
Hmm..... I wonder how much ASUS/XFX/EVGA make off their video cards....
Hmm..... I wonder how much ASUS/XFX/EVGA make off their video cards....
Hmmm, you really think there are the same amount of people buying consoles that are buying consoles?
Hmmm, you really think there are the same amount of people buying consoles that are buying consoles?
I meant video cards! Doh!
90 percent of what consumers want, I doubt it. 90 percent probably want the PS3 but couldn't afford it so settled for a Wii. Now that the PS3 is only $99 more, i think the future of the Wii and 360 are in serious trouble. My guess is this is the begining of a huge following of the PS2 and the end of the Wii
attack.
Reading this article and the following comments, Nintendo must be going under!
If you think this is bad you should have been here during the AMD/ATi merger a few years ago...
The last console I purchased was a used SNES for $100. After that it was building PCs; faster hardware/software upgrades and all that. After playing a Wii at a friends house, guess what my wife will be getting for her birthday? Fact is as much as I hated the system concept I love playing the damn thing. And will more then likely end up enjoying the system more the my wife who has begged for one for like 2 years.
The Wii nails its market the novice/casual/family "gamer", hell even my mom wants one, Nintendo knew going in that Sony and MS had an amazing hold on the hardcore/normal gamer. So they developed a system that appealed to an untapped but large market. The drop in profits shows a slow down due to over saturation of the market not the failings of a product line. The price drop to $199 will bolster it's sales to value minded buyers, and skeptics who didn't want to dish out $250 but will consider it at $200.
Q4 will look a lot better trust me.
If you think this is bad you should have been here during the AMD/ATi merger a few years ago...
Yeah, but those are [i]your[i] friends. Unless you have 50,000,000 friends, that logic is no good.
lol quoted the wrong guy, sorry.
90% of my friends play xbox360 and ps3. The other 10% is just those who have all 3 systems.
Yeah, but those are your friends. Unless you have 50,000,000 friends, that logic is no good.
I'd give about $50 for a WII. It's just a gimmick party-play system to me.
90% of my friends play xbox360 and ps3. The other 10% is just those who have all 3 systems.
yes but unlike you most people have more than 2 friends
I have one of these....why only a component out.it may be 480p but component out is in analog and not a digital signal.....looks like crap at best on all of my HD TV's......
mine in only 6 months old but you would think they would implement an HDMI port for a better picture.
guess i fit into all the groups..
i own a
PSP
DS
DSI
Wii
360
PS3