Wii U Sales Forecast Cut

[Karloff]

Wii U Sales Forecast Cut

The latest Nintendo financials are out, and Wii U sales expectations are down 1.5 million units.

Nintendo's current financial year sales estimates for its new Wii U console have been cut to 4 million units, down from its 5.5 million previous estimate. The Wii U isn't the only one down on its estimates; sales of most of its hardware, including the Wii, isn't performing to expectations.

A weak Yen, as compared to the Euro and the Dollar, pushed Nintendo's predicted net profits up to ¥14 billion; a bright spot, given that the previous estimate was ¥6 billion. Sales of the Wii U console did well over Christmas, and in Japan, but in other markets - particularly the Americas - the Wii, its predecessor, enjoyed better sales returns. Software Wii U sales were also down; Nintendo confirmed that sales of Wii U games would total 16 million for the year, not 24 million as it had previously forecast. All in all, as the Wii U sells at a loss, its contribution to the bottom line was to pump the overall operating loss up to ¥5.8 billion; if not for that weak Yen, Nintendo might not be looking at a healthy net profit forecast.

That said, the strong Yen [http://www.escapistmagazine.com/news/view/120296-Nintendo-Suffers-29-1-Billion-Yen-Operating-Loss] earlier in the financial year pounded Nintendo's profit margin, so a weak Yen now is a welcome relief. Meanwhile, Nintendo blamed "few new title releases" for poor Wii games sales. 3DS sales were generally solid, with Nintendo's "evergreen titles" - the Mario games - doing well. Even so, sales forecasts for the 3DS have dipped from 17.5 million to 15 million units. Sales estimates for the Wii have also been cut, from 5 to 4 million units.

Source: Financials [http://www.nintendo.co.jp/ir/pdf/2013/130130e.pdf]


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[Roxas1359]

If this means price cut in the Deluxe edition of the Wii U then I'm going to be quite happy. I want to get a Wii U Deluxe, but I find that it's too expensive and doesn't have enough games to warrant such a price. As for the 3DS it has the same problem, not enough games for the price. Yeah you can download games, but people want more 3DS titles to play, not renditions of older games. Although this is Nintendo...

 

[BrotherRool]

4 million is still pretty good

 

[subtlefuge]

It will go up after E3, once the games announced actually start to be released. Rayman: Legends, Pikmin 3, Bayonetta 2, and a few others will sell the Wii U a lot more than the paltry amount of games currently available.

Heck, Nintendo already did a mini E3 a week ago where they announced Wind Waker HD and Yoshi's Yarn. I have no doubt that I'm going to be eating Ramen for a few weeks to make room in my budget for it. I just wouldn't expect anyone to rush out to buy the Wii U until some big games are really close to being released.

Also, why hasn't Nintendo learned to always launch with a 3D Mario/Mariokart/Smash Bros/Zelda game? Mario Kart 64 made me buy the N64, I honestly have no clue what made me buy the Gamecube, but I definitely bought the Wii for Brawl.

 

[juyunseen]

Why does every single company assume their thing is gonna be the biggest thing ever, and overshoot their sales forecasts?

Seriously, every week some company is announcing that their lowering their forecasts.

 

[Roxas1359]

Why does every single company assume their thing is gonna be the biggest thing ever, and overshoot their sales forecasts?

Seriously, every week some company is announcing that their lowering their forecasts.

Over ambition and optimism I think is what goes through their minds. Companies like to set high, unrealistic standards for their products and get depressed when then can't reach them. Hey, companies do the same thing I do.

 

[juyunseen]

Why does every single company assume their thing is gonna be the biggest thing ever, and overshoot their sales forecasts?

Seriously, every week some company is announcing that their lowering their forecasts.

Amen. I feel like this mentality is what's causing a lot of problems for the games industry in general. The companies keep pouring hundreds of millions of dollars, hoping for a COD-like success and are baffled when it doesn't happen.

Hitting a homerun is a pleasant surprise. It's good when it happens, but you dont swing for the fences every damn time and expect to do well.

Why does every single company assume their thing is gonna be the biggest thing ever, and overshoot their sales forecasts?

Seriously, every week some company is announcing that their lowering their forecasts.

Over ambition and optimism I think is what goes through their minds. Companies like to set high, unrealistic standards for their products and get depressed when then can't reach them. Hey, companies do the same thing I do.

It's a real issue.

Overassume your COD clone, or new console's performance, and it just hurts everyone.

 

[Scribblesense]

Why does every single company assume their thing is gonna be the biggest thing ever, and overshoot their sales forecasts?

Seriously, every week some company is announcing that their lowering their forecasts.

Amen. I feel like this mentality is what's causing a lot of problems for the games industry in general. The companies keep pouring hundreds of millions of dollars, hoping for a COD-like success and are baffled when it doesn't happen.

Hitting a homerun is a pleasant surprise. It's good when it happens, but you dont swing for the fences every damn time and expect to do well.

People don't invest in a company that only wants moderate success. If you're not trying to be number one, you're not seen as competitive. More units sold also means a larger install base, which means more sales for game developers who aren't going to waste time and effort building a blockbuster game if the product it is released for is niche at best. All those developers who supported the console at launch would have been hesitant if Nintendo had only estimated a million sales.

In other words, it always pays to be optimistic.

 

[Scribblesense]

Why does every single company assume their thing is gonna be the biggest thing ever, and overshoot their sales forecasts?

Seriously, every week some company is announcing that their lowering their forecasts.

Amen. I feel like this mentality is what's causing a lot of problems for the games industry in general. The companies keep pouring hundreds of millions of dollars, hoping for a COD-like success and are baffled when it doesn't happen.

Hitting a homerun is a pleasant surprise. It's good when it happens, but you dont swing for the fences every damn time and expect to do well.

People don't invest in a company that only wants moderate success. If you're not trying to be number one, you're not seen as competitive. More units sold also means a larger install base, which means more sales for game developers who aren't going to waste time and effort building a blockbuster game if the product it is released for is niche at best. All those developers who supported the console at launch would have been hesitant if Nintendo had only estimated a million sales.

In other words, it always pays to be optimistic.

It's one thing to be optimistic, it's another to be unrealistic. I'd rather make a profit of a couple million then take a billion dollar risk that is incredibly unlikely to pay off.

I wouldn't say their forecast was unrealistic. The Wii U was selling within expectations for its first month, but then dropped off drastically as soon as the holiday season ended. If there's any time to expect a bump in sales, it's Christmas.

One important factor of large, multi-billion dollar risks is they are an excellent foundation for future success. Nintendo may have more unsold product on the shelves than they want, but they have plenty of options to move that product because of the previous risk they took.

Launching a product isn't like digging a hole, but like building a skyscraper - as more games are released (and Nintendo games are always system sellers) the Wii U will look more and more valuable and eventually, hopefully, that billion-dollar risk will pay off. The only potential hurdle is the Wii U remaining unsold. I feel like I'm rambling, but hopefully that makes sense.

 

[Shoggoth2588]

It's only a matter of time before Wii U sales skyrocket back up unless the Durango or PS4 is announced to be the best thing since the PS2. Nintendo just announced a lot of upcoming titles and launch titles that we're still waiting for (Lego City: Undercover for example) finally has a release date. I've had my U since launch day so I can't really buy another one yet. Sure it's region locked but the US is getting Monster Hunter 3 soon and I don't really have any good reason to import one...yet...

 

[DrunkOnEstus]

I think one major problem here is a lack of education by consumers. I was at Walmart the other day looking at the games, and it was astounding how many people thought it was just a new Wii model. I was talking to people about how ZombiU played, and I heard "so is it worth buying just the tablet controller for my Wii, then?" more than once. Many don't understand that it has better graphics, HDMI out, no friend codes, etc etc. I felt like I should have gotten a paycheck given the amount of explaining I did just standing there.

 

[Starik20X6]

I think one major problem here is a lack of education by consumers. I was at Walmart the other day looking at the games, and it was astounding how many people thought it was just a new Wii model. I was talking to people about how ZombiU played, and I heard "so is it worth buying just the tablet controller for my Wii, then?" more than once. Many don't understand that it has better graphics, HDMI out, no friend codes, etc etc. I felt like I should have gotten a paycheck given the amount of explaining I did just standing there.

This. Everyone who has played my Wii U absolutely loves it, to the point where I don't think a single person hasn't said "I've gotta get one of these". But until i explained to them what it was and how it differs from the Wii, nobody had a clue. Nintendo just needs to put it out there a little more.

 

[Scribblesense]

I think one major problem here is a lack of education by consumers. I was at Walmart the other day looking at the games, and it was astounding how many people thought it was just a new Wii model. I was talking to people about how ZombiU played, and I heard "so is it worth buying just the tablet controller for my Wii, then?" more than once. Many don't understand that it has better graphics, HDMI out, no friend codes, etc etc. I felt like I should have gotten a paycheck given the amount of explaining I did just standing there.

This. Everyone who has played my Wii U absolutely loves it, to the point where I don't think a single person hasn't said "I've gotta get one of these". But until i explained to them what it was and how it differs from the Wii, nobody had a clue. Nintendo just needs to put it out there a little more.

Indeed. Focusing on the controller has helped and hurt; it's the Wii U's defining feature and an easy sell, but it's tough to explain that it's part of a brand new console without screaming THE WII U IS A BRAND NEW CONSOLE.

To really understand the controller, you have to pick it up and play with it, just like the Wiimote, which is likely what Nintendo was depending on. The major difference between the Wii and Wii U was that the Wii was everywhere when it launched - I remember it being covered in the news constantly during its launch year, from the shortage in sales to injuries sustained from flying controllers to it being used in retirement homes. If the Wii U had inspired that kind of coverage, it would have been the runaway success (not to downplay its current success) that the Wii was.

Makes me wonder if chucking Gamepads at people on the street would make the Wii U sell better.