Is Nintendo Back? Company Reports Unexpected Profits

StewShearerOld

Geekdad News Writer
Jan 5, 2013
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Is Nintendo Back? Company Reports Unexpected Profits



After several years of operating at a loss, Nintendo has reported that it made 9.3 billion yen in profits during the 2014's second fiscal quarter.

The past several years have been rough for Nintendo. <a href=http://www.escapistmagazine.com/news/view/116974-Nintendo-Records-First-Ever-Full-Year-Loss-in-2011>Stepping off of the gravy train that was the Wii, it experienced sharp declines in profitability that have seen it operating at a loss for several years. That being the case, recent reports from the Japanese game maker would seem to indicate that its fortunes could be taking a turn for the better.

According to the aforementioned reports, Nintendo apparently experienced unexpected operating profits during 2014's second fiscal quarter. During the period between July and September the company made 9.3 billion yen (roughly $86.1 million). This is, of course, is substantial increase from its situation during the same time last year when it suffered a 3.7 billion yen loss. The company would go on to lose more than <a href=http://www.escapistmagazine.com/news/view/134309-Nintendo-Reports-455-Million-Loss-But-Has-High-Hopes-For-Next-Year>$455 million overall during the course of fiscal year 2013 with much of the blame being placed on the Wii U's lackluster sales performance.

While it might be tempting to see this as good news however, there are some who caution against thinking that everything will be all flowers and sunshine for Nintendo going forward. Speaking with The Escapist, Wedbush Securities analyst Michael Pachter indicted that the company's recent success might be more muted than some might like to hope.

"Much better expense control drove [Nintendo's] operating profit," said Pachter. "This was not a revenue driven event. Revenues continue to decline, hardware sales continue to be exceedingly weak, and although I am certain that Nintendo can hit its profit target this year by cutting costs, the rest of the industry is growing and they are not."

One has to wonder if <a href=http://www.escapistmagazine.com/news/view/137488-Super-Smash-Bros-3DS-Sells-One-Million-Copies-in-Two-Days-in-Japan>the recent success of Super Smash Bros. on the 3DS might also have something to do wit it. That said, if Pachter's assessment is correct, it could mean that there's still a lot of work ahead for Nintendo before we can safely say its recent trouble are behind it. We've reached out to Nintendo to see if we could get their take on the issue and see what they attribute this profit to.

Source: <a href=http://www.reuters.com/article/2014/10/29/nintendo-results-idUSL3N0SJ2HW20141029>Reuters




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Atmos Duality

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Mar 3, 2010
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Actually putting out GAMES helps game companies make revenue?
What a twist!

ASIDE: Pachter can say what he wants about revenue. Anyone with fucking eyes could see why the WiiU became a big stone around Nintendo's neck around this time last year, and it had less to do with operating costs and more to do with software sales.

Hardware sales being weak doesn't really account for the 3DS's strong software performance.
 

AidoZonkey

Musician With A Heart Of Gold
Oct 18, 2011
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Nintendo has been fantastic this year with its PR, games and marketing. Whilst Sony and Microsoft have been try to get a solid IP onto there systems, Nintendo has released a huge amount of games that are starting to make the Wii U Viable (Plus smash brothers makes any console sell like hot cakes)and make the 3DS more profitable. It also helps these games are actually good games and not just bad games given a Nintendo make over
 

LysanderNemoinis

Noble and oppressed Kekistani
Nov 8, 2010
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You know, I have an idea how Nintendo could make a little extra cash quickly: How about you allow Bayonetta 2 to be ported to the PS3, PS4, XBOX360, and XBone? Because it's not going to make much money just staying on the WiiU. While a lot of people aren't to willing to shell out several hundred dollars for a system just so they could play one (maybe two or three) game, I'd buy Bayonetta 2 for the PS3 right now. And this is coming from someone who rarely buys games at launch. And yes, I know I continually bring this up, but it doesn't change the fact I'm still annoyed that I can't play it.
 

Diablo1099_v1legacy

Doom needs Yoghurt, Badly
Dec 12, 2009
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LysanderNemoinis said:
You know, I have an idea how Nintendo could make a little extra cash quickly: How about you allow Bayonetta 2 to be ported to the PS3, PS4, XBOX360, and XBone? Because it's not going to make much money just staying on the WiiU. While a lot of people aren't to willing to shell out several hundred dollars for a system just so they could play one (maybe two or three) game, I'd buy Bayonetta 2 for the PS3 right now. And this is coming from someone who rarely buys games at launch. And yes, I know I continually bring this up, but it doesn't change the fact I'm still annoyed that I can't play it.
Isn't Platinum Games the ones that own the rights to that Series? Why would Nintendo profit from that?

OT: The Smash Crowd would totally be a nice cash injection, though I'm kinda worried that are over-committing to that one game.
Between the figures, All the stuff in that 50 facts trailer on Nintendo Direct and the amount of content hey are pouring into it, I'm betting that there is a lot of budget going into that game.
I'm just worried that we might have another RE6 situation where Capcom put all their eggs in one basket and then get burned when the game under-preformed at sales.

Now, I know that SSB4 isn't like RE6, I just hope that they didn't sink so much into it that it has to be a mega hit.
 

HaileStorm

Regular Member
Apr 15, 2014
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I don't know why, but I've never liked Michael Patcher. He always just comes off as an arrogant know it all with very little insightful information....but then again that could just be me.
 

Story

Note to self: Prooof reed posts
Sep 4, 2013
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HaileStorm said:
I don't know why, but I've never liked Michael Patcher. He always just comes off as an arrogant know it all with very little insightful information....but then again that could just be me.
I'm indifferent to him, but I can safely say it isn't just you. I know some people really do not like him.
 

Arfreid

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Aug 13, 2009
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HaileStorm said:
I don't know why, but I've never liked Michael Patcher. He always just comes off as an arrogant know it all with very little insightful information....but then again that could just be me.
I liked his show at the beginning because I found them insightful on how the industry worked... Then the industry started going in a direction I didn't like (overpriced dlc, drm, fees for (previously free) online services) and he supported those thrends because on the business side it's what generates more money.

What really made stop taking him seriously is that he started to belittle any other company that didn't share this vision and has been raining the "anticuated","doomed to fail" or simply the "get out of the business" verdict.
 

Aiddon_v1legacy

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Nov 19, 2009
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HaileStorm said:
I don't know why, but I've never liked Michael Patcher. He always just comes off as an arrogant know it all with very little insightful information....but then again that could just be me.
Nobody with a brain likes Pachter. The guy is wrong so much I wonder why he's even still around. Ever since Gametrailers dropped his shitty show he's thankfully been in the media less, but he's still an annoyance that needs to go away. It also doesn't help that his attitude towards Nintendo can best be described as "boy who cried wolf" as he had it out for the company when they were kicking ass up and down the industry and came out of the last generation not only being profitable but IMMENSELY profitable. I think he just takes every chance he can to try and belittle them because they kept proving him wrong. At least that's the only explanation I can come up with for his perplexing obsession with them.

Diablo1099 said:
Isn't Platinum Games the ones that own the rights to that Series? Why would Nintendo profit from that?
Or we could say the obvious question: PEOPLE ARE STILL GOING ON ABOUT THIS?????? Criminy, it's been over two years since the game's exclusivity was announced, you'd think gamers would have gotten over it by now. Maybe if gamers had actually bought the first one when it came out then maybe Nintendo wouldn't have had to save it from cancellation.

Anyway, I find the most amusing detail from the financial report to be that Hyrule Warriors actually exceeded expectations in America and Europe. Considering that Nintendo is now getting a handle on HD development and no longer have construction expenses to worry about (seriously, making that new development center cost them a lot) I think it can be safe to say that people crying Nintendoomed over the last few years can give it a rest.
 

V4Viewtiful

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Feb 12, 2014
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Good for Nintendo.

I knew a lot of there games where in development but knowing that there software is picking up makes me glad to have bought Wii You recently, now give us a few fighting games and decent net code and we're tops.
 

fix-the-spade

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Feb 25, 2008
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Diablo1099 said:
Isn't Platinum Games the ones that own the rights to that Series? Why would Nintendo profit from that?
Kind of, Nintendo funded Bayonetta 2 and has exclusive publishing rights after Sega dropped Platinum games. If Bayonetta were to be ported at all Nintendo would have first rights on publishing, so they could certainly make money from it.

But Nintendo obviously wants it as an exclusive, since such good games are hard to come by.
 

Olas

Hello!
Dec 24, 2011
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Not remotely surprised. I was saying Nintendo could, and probably would, turn things around. The rules that would normally govern a console's sales are less true of Nintendo because it provides so much quality first party support. For the last 2 generations Nintendo has basically had to push it's consoles by itself and it's managed so far.

LysanderNemoinis said:
You know, I have an idea how Nintendo could make a little extra cash quickly: How about you allow Bayonetta 2 to be ported to the PS3, PS4, XBOX360, and XBone? Because it's not going to make much money just staying on the WiiU. While a lot of people aren't to willing to shell out several hundred dollars for a system just so they could play one (maybe two or three) game, I'd buy Bayonetta 2 for the PS3 right now. And this is coming from someone who rarely buys games at launch. And yes, I know I continually bring this up, but it doesn't change the fact I'm still annoyed that I can't play it.
Nintendo is always getting left out of ports, it still doesn't even have a port of Minecraft, and EVERYTHING has a port of Minecraft. You get to play games like Shadow of the Colossus and Last of Us, and tons of other games either exclusive to Playstation or just excluded from Nintendo consoles. You want to play Bayonetta 2, a game that Nintendo funded and one of the few good games it HAS, without having to buy a Wii U?

 

Roxas1359

Burn, Burn it All!
Aug 8, 2009
33,758
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Atmos Duality said:
Actually putting out GAMES helps game companies make revenue?
What a twist!
Clearly this is a fluke. Games don't sell consoles, TV does. We need more TV and sports and then the sales will really soar high above all else! XD

OT: In all seriousness, I never believed that Nintendo as a whole is "doomed", but you cannot deny that the Wii U was in serious trouble. If Nintendo can keep up the momentum in advertising and games released then they'll be fine. However, what I've seen is Nintendo doing ad campagins for like a week or 2 and then drop them completely. After that the sales die down faster than thin mints sell out for girl scouts. Now to wait for the usually people to show up, praising Nintendo for all it is and how they can do no wrong, and as such make me hate identifying myself as a Nintendo fan because of how overzealous they are.
 

The Goat Tsar

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Mar 17, 2010
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Story said:
HaileStorm said:
I don't know why, but I've never liked Michael Patcher. He always just comes off as an arrogant know it all with very little insightful information....but then again that could just be me.
I'm indifferent to him, but I can safely say it isn't just you. I know some people really do not like him.
I'm not familiar with him either. But my friends really dislike him. Apparently he's been saying that "Nintendo is dying" for a really long time and he's incredibly douchey about it as well. They also tell me that he's always wrong and that people shouldn't listen to him. I'm not sure if that assessment is true, but I wouldn't be surprised if it was.
 
Sep 14, 2009
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"is nintendo back?"



...they were gone in the first place?

Of course the wiiu had one hell of a dryspell at first, it had games that pleased next to no one and the hardware was pretty much second rate compared to what was coming out with the ps4 and xbone (let alone PC), and hardware sales hardly drive revenue, it's in the software sales.

plus with super smash coming out, of course things are going to start selling like hotcakes, black friday is going to be filled to the brim with smash purchases.
 

Lightknight

Mugwamp Supreme
Nov 26, 2008
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Wait, so Nintendo starts to put out Nintendo games on a machine that is largely only purchased to play Nintendo games and then they start doing better?

Only took them around two years to get around to the console sellers in any force. Now a price drop is all that's left to convince me to pull out some cash.

EDIT: well... I say that but there's still only five games that I want. Even at $250 that would still add $50 to the price of every Nintendo game I'd want since the price of the console is a Nintendo game tax.
 

BrotherRool

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Oct 31, 2008
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Atmos Duality said:
Actually putting out GAMES helps game companies make revenue?
What a twist!

ASIDE: Pachter can say what he wants about revenue. Anyone with fucking eyes could see why the WiiU became a big stone around Nintendo's neck around this time last year, and it had less to do with operating costs and more to do with software sales.

Hardware sales being weak doesn't really account for the 3DS's strong software performance.
The Wii U's hardware sales were abysmal and they were so bad that if Nintendo managed to sell any particular game to every person who had a Wii U, it would still only be a pretty successful game. The Wii U is definitely caught in that loop where the software sales are bad because the hardware sales are bad because the software sales are bad.

Even though the 3DS isn't selling 'well' compared to previous Nintendo handhelds (it's more like a PSP than anything), it still has a huge install base to sell the games too.


Saying that, I don't really believe that Nintendo is ever going to be in trouble financially. I may not invest in them, because it's not necessarily easy seeing them adapt to a world where console sales drop off. They've been incredibly slow in adapting to new technology with the Wii and Wii U. The state of the Wii U internet is probably at its best like the state of the PSN or Live a whole generation ago.

But they've got a strong fanbase, they make fantastic games and their games are guaranteed money makers. Because they've got no 3rd party support, fans basically have to buy Nintendo games. That combined with Nintendo's bank mean they'll probably always be financially successful.

On the other hand, Nintendo's financial success means nothing to me. I care about whether their console is going to be competitive or not and if I'm going to be able to play their games or not. The 3DS is always attractive, but I'm not sure they can get the Wii U to a point where it'd ever be attractive to more than the diehard fanbase. I think the Wii U's shot is basically over now, at best they just need to prove that a Wii U 2 wouldn't also be a dead on arrival console, which they can do with solid Wii U support
 

LysanderNemoinis

Noble and oppressed Kekistani
Nov 8, 2010
468
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Olas said:
Nintendo is always getting left out of ports, it still doesn't even have a port of Minecraft, and EVERYTHING has a port of Minecraft. You get to play games like Shadow of the Colossus and Last of Us, and tons of other games either exclusive to Playstation or just excluded from Nintendo consoles. You want to play Bayonetta 2, a game that Nintendo funded and one of the few good games it HAS, without having to buy a Wii U?
Yes, I do. Because like you said, there's not exactly a lot of good (or rather, mature games for the system). Then again, there's not much about Bayonetta 2 that could be considered mature, heh. I don't know what system or systems you have, but would you buy a console to just play one game? Not a lot of people have the scratch to throw down several hundred dollars for just one game. Aside from Bayonetta 2, the only games on the WiiU I have any interest in is Devil's Third and Shovel Knight, and even then they're not really huge deals for me (also not a PC gamer).

The type of gamer who likes Bayonetta and your average Nintendo fan don't have a very big overlap. But the type of people who would like Bayonetta, The Last of Us, Shadow of the Colossus, etc. are a lot closer in tastes, hence why it would be a good idea financially to release the game on other systems. Nintendo getting a third-party exclusive like Bayonetta is a lose-lose proposition. Yeah they get this great exclusive, but it's not going to sell well, the developer gets ire from previous fans like myself who feel a bit gipped by everything, and everyone ends up unhappy, save for the ten souls who actually own a WiiU already and are chomping at the bit for a game like Bayonetta.

It's one thing to have a series to be exclusive to one system to begin with, but it's another to switch consoles. Imagine how pissed Halo fans would be if suddenly the series moved to PS4. Or if Metroid went to Xbone. It was just a dumb idea, and Sony and Microsoft were stupid for passing up on the IP. And now everyone regrets it (except for the aforementioned ten people).
 

Razhem

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Sep 9, 2008
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LysanderNemoinis said:
Olas said:
Nintendo is always getting left out of ports, it still doesn't even have a port of Minecraft, and EVERYTHING has a port of Minecraft. You get to play games like Shadow of the Colossus and Last of Us, and tons of other games either exclusive to Playstation or just excluded from Nintendo consoles. You want to play Bayonetta 2, a game that Nintendo funded and one of the few good games it HAS, without having to buy a Wii U?
Yes, I do. Because like you said, there's not exactly a lot of good (or rather, mature games for the system). Then again, there's not much about Bayonetta 2 that could be considered mature, heh. I don't know what system or systems you have, but would you buy a console to just play one game? Not a lot of people have the scratch to throw down several hundred dollars for just one game. Aside from Bayonetta 2, the only games on the WiiU I have any interest in is Devil's Third and Shovel Knight, and even then they're not really huge deals for me (also not a PC gamer).

The type of gamer who likes Bayonetta and your average Nintendo fan don't have a very big overlap. But the type of people who would like Bayonetta, The Last of Us, Shadow of the Colossus, etc. are a lot closer in tastes, hence why it would be a good idea financially to release the game on other systems. Nintendo getting a third-party exclusive like Bayonetta is a lose-lose proposition. Yeah they get this great exclusive, but it's not going to sell well, the developer gets ire from previous fans like myself who feel a bit gipped by everything, and everyone ends up unhappy, save for the ten souls who actually own a WiiU already and are chomping at the bit for a game like Bayonetta.

It's one thing to have a series to be exclusive to one system to begin with, but it's another to switch consoles. Imagine how pissed Halo fans would be if suddenly the series moved to PS4. Or if Metroid went to Xbone. It was just a dumb idea, and Sony and Microsoft were stupid for passing up on the IP. And now everyone regrets it (except for the aforementioned ten people).
This sounds pretty petty to me. "Since the console is obviously shit, why does that good game have to choke in those seas of mediocrity?! god forbid I consider sullying my house with FILTHY WII U even if it has a pretty sexy assortment of games lately that I could perfectly enjoy if I wasn't so anal about it"

Face it skipper, Nintendo put the money for it because your beloved sony considered it shit, they are not going to just let it go because a few guys whine about it since god knows the Wii U needs non nintendo exclusives in it's arsenal.

Also, as for your absurd example of "what would you think if something company jumped!!!" It already happened, a lot, during the 16 to 32 bit era, surprise, it wasn't the end of the world. Also, Halo and Metroid are FIRST party, so your example still doesn't make any sense either way.