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$229 Million Loss For Nintendo

May 7, 2014

Nintendo Misses Wii U And 3DS Sales Targets with a Huge $229 Million Loss.

Nintendo has just posted their financial results for the last fiscal year, and many of their projections fell short of their own expectations.  Nintendo revised many of their forecast numbers downward in January, but the final results fell below even those altered projections in most areas. Worldwide sales ended up at $5.6 billion, down from a revised forecast of $5.79 billion, which was once projected to be $9 billion in April 2013.

Photo: Wikipedia

Photo: Wikipedia

There was an operating income shortfall of $455 million, more than the predicted $343 million, and a far cry from the prediction of a $981 million positive outcome.

Net income was up from projections, allowing Nintendo net loss to be $229 million as averse to the predicted $245.4 million. All of this means Nintendo’s total loss for the last three years was $1.18 billion. The fiscal year, Nintendo is predicting a positive gain of $392.7 million.

But that’s the problem with Nintendo’s vision. They haven’t been just way off lately, they’ve been off for years. Nintendo’s losses this year are mostly driven by both the Wii U and 3DS missing their sales goals.

Last April 2013, Nintendo predicted 9 million Wii Us and 18 million 3DS handhelds would be sold during the fiscal year. In early 2014, that was changed to 2.8 million and 13.5 million. As of today, the final numbers were even lower, at 2.72 million and 12.24 million. Wii U total sales are now a total of 6.17 million with its main software offerings being New Super Mario Bros. U (4.16 million), Nintendo Land (3.09 million) and Super Mario 3D World (2.17 million). More titles like Pikmin and Wii Fit U haven’t broken a million copies sold as of yet.

In order to dodge being so off base with their original forecasts for this year, Nintendo is now envisioning that even with popular games like Mario Kart 8 and Super Smash Bros., they’ll only sell 3.6 million Wii Us this current fiscal year, a 60% loss from their forecast for the console this time in 2013. Their prediction for the 3DS is holding at 12 million, and they’re predicting $5.8 billion in revenues and a $197 million profit for this year.

In the earnings report, Nintendo says that they will refocus on making games for the Wii U that uses its great “differentiator,” the gamepad. They also once again talk about their ambitions for fitness-based, “Quality of Life”-improving entertainment experiences. There was no further light shed on what exactly that means, but it’s said to be a major change for the company as part of a long-term plan to expand beyond games.

Nintendo also mentions that they’ll dip into their IP pool to grant licensing of some of their more famous characters for use beyond video games. It’s unknown what exactly that might include, but it could mean anything from more consumer products to feature length film adaptations,we might see in the near future.

Nintendo says they won’t be announcing any new hardware at E3 this year, and in their main video demonstration they will likely be selling new Wii U and 3DS titles to try and get fans excited. From their low sales projections that they’ve been hit with a substantial reality check, and hopefully they’ll figure out a way to turn things around. There are great Nintendo games on the scope this year, and maybe they’ll be enough to start reversing the company’s fortunes after a hectic few years.

$229 Million Loss For Nintendo.

About Jordanna

From San Diego, California. "Good news is rare these days, and every glittering ounce of it should be cherished and hoarded and worshiped and fondled like a priceless diamond." -Hunter S. Thompson
  • Ace

    Great article!