Nintendo Financials: Wii U Still A Drag On The Bottom Line

[Karloff]

Nintendo Financials: Wii U Still A Drag On The Bottom Line

Remember that Wii U price drop? So does Nintendo.

Nintendo's current financials are out, and things aren't looking so great for the Wii U. Though the company's other devices are strong sellers, the Wii U only managed to move 0.46 million hardware and 6.30 software units worldwide in the six months ending September 2013. That it couldn't afford to make [http://www.escapistmagazine.com/videos/view/escapist-news-now/8005-Wii-U-Price-Drop-2DS-Revealed] - isn't doing the company any favors. Nintendo says the Wii U markdown in the US and Europe had a "negative impact on Nintendo's profits," contributing to an overall operating loss of ¥23.2 billion (approximately $236.3 million).

Administration and expenses ate up a gross profit of ¥62 billion ($631.5 million), and again, Nintendo blames the Wii U, as a substantial portion of those expenses relate to sales advertising and research and development for its next generation console. The Wii U sold as many units in the US - 230,000 - as it did in Japan, from April to September 2013, and the company's really hoping for a bright Christmas [http://www.escapistmagazine.com/news/view/128947-Nintendo-of-America-Wiis-Not-Dead-Yet-At-Least-In-US]. Despite the glut of bad news, Nintendo will not adjust its financial forecast for the year.

"We strive to increase the profitability of our business by accelerating digital distribution of packaged software for both Nintendo 3DS and Wii U that we started last year," says Nintendo, "and improving hardware profitability by reducing its costs." Better hope so, else Mario may need to downsize to a more modest mushroom kingdom. That, or hold one hell of a yard sale.

Source: Nintendo financials [http://www.nintendo.co.jp/ir/pdf/2013/131030e.pdf]


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[Fappy]

I can't wait to see the numbers for the holiday season. 3DS sales are going to skyrocket with the release of Pokemon, leaving it's console counterpart in the dust. Know why the 3DS is doing well? It's because it actually has games! Who'd have thought?!

 

[J Tyran]

I can't wait to see the numbers for the holiday season. 3DS sales are going to skyrocket with the release of Pokemon, leaving it's console counterpart in the dust. Know why the 3DS is doing well? It's because it actually has games! Who'd have thought?!

It took a while for the 3DS to pick up steam though, the Wii U might do the same. Who knows maybe the holiday season might be the start, there will be a lot of parents after consoles and the Wii U is a fair bit cheaper than the Xbone or the PS4.

 

[Mr.Mattress]

I'm not worried (Yet) for the WiiU. Yes, it's sales suck hard right now, but with the Price Cut and the avalanche of first party titles coming, I'm hoping that the WiiU will pick up fast.

If it doesn't have a decent Christmas, then I will worry for the WiiU.

 

[Fappy]

I can't wait to see the numbers for the holiday season. 3DS sales are going to skyrocket with the release of Pokemon, leaving it's console counterpart in the dust. Know why the 3DS is doing well? It's because it actually has games! Who'd have thought?!

It took a while for the 3DS to pick up steam though, the Wii U might do the same. Who knows maybe the holiday season might be the start, there will be a lot of parents after consoles and the Wii U is a fair bit cheaper than the Xbone or the PS4.

It's possible, but I'm in the boat of people that think Nintendo's already lost this console generation. The 3DS had a much bigger advantage in its market seeing as its only real competition for hardcore gaming was the Vita (which was/is also struggling). The Wii U still does have a chance, but they simply must make Q4 count.

Despite not owning a Wii U I do hope Nintendo bounces back. I love what they've been doing with the 3DS.

 

[spartandude]

I can't wait to see the numbers for the holiday season. 3DS sales are going to skyrocket with the release of Pokemon, leaving it's console counterpart in the dust. Know why the 3DS is doing well? It's because it actually has games! Who'd have thought?!

It took a while for the 3DS to pick up steam though, the Wii U might do the same. Who knows maybe the holiday season might be the start, there will be a lot of parents after consoles and the Wii U is a fair bit cheaper than the Xbone or the PS4.

That is true, but at the same time the other consoles will eat into the Wii U market share, where as the 3DS didnt really have any competition when it came out.
I would like to see the Wii U do better (id also like to see it get some games) but i fear with too much competition it will go unnoticed even when games come out.

Well at least the 3DS is doing really well for them and making up for the Wii U

 

[Seracen]

No games are a big point, but I'm also surprised at the utter lack of marketing for the console. I'm not criticizing Ninty's choice not to have a stage at the gaming shows...just that there seems to be very little presence in general ad awareness for Wii-U games, or any Nintendo game, at all.

I suppose they'd have an uphill struggle vs XBONE/PS4, but that doesn't mean they should forego the contest. Then again, I suppose one needs a proper line up in order to do proper marketing.

 

[moggett88]

It's almost as if they should have focused on building a decent library of Wii games before cutting bait and releasing a new console, just 'cause. There are games I want to play on Wii U, but I just can't justify spending that amount on a console that I only want two games for (which is the same problem I have with buying a 3DS just for the sake of Pokemon).

Nintendo! If you build games, we will come (gross).

 

[Lightknight]

Looking at past console sales, the WiiU should have been increasing in sales a lot more at this point of the holiday cycle. It looks like the preorders for other consoles are likely carrying on that trend behind the curtains and that's not good for the WiiU.

I don't know that more games will revitalize it. The $300 price point is still harming it in the casual gaming market that exploded the Wii while the limited processing capabilities is making the $100 more machine looking much more attractive with processing and third party support considered.

They're inadvertantly being the decoy of the decoy effect for Sony. Any advantage they had for releasing a year early has been thoroughly lost at this point and if Sony and the XBO deliver what they promised the WiiU may never come back even with a trickle of good games.

The difference with the Wii was that it had a new way to play games that was immediately apparent and it was affordable with great family fun and party games. The WiiU has a $140 peripheral that isn't deemed worth getting with a handful of games that even use it and fewer that actually need it with nearly no game support (first second or third party). It is in error for Nintendo to think that only games are the problem. Yes, if they flood it with a laundry list of great games I would strongly consider it. But I expect their library to have fewer and fewer titles as the WiiU's more powerful brothers come into their own.

It is good, at least, that the DS is in full power. No matter what Nintendo decides to do with their home consoles in the coming years, hopefully the handheld market will remain viable.

 

[Quantum Star]

I'm not worried (Yet) for the WiiU. Yes, it's sales suck hard right now, but with the Price Cut and the avalanche of first party titles coming, I'm hoping that the WiiU will pick up fast.

If it doesn't have a decent Christmas, then I will worry for the WiiU.

I would give it until Smash and Mario Kart comes out. If those can't move enough consoles, nothing else can.

 

[Arawn]

I like many thought the Wii U was only an add on the Wii system. Imagine my surprise when I found out it was totally new console. But that did little to gain my attention to the unit.Overall I've heard little in the way of games to even get a flicker of said attention. I really haven't seen any advertising for anything Wii U related. Well except for Bayonetta 2. That news made my head turn.

 

[Eternal_Lament]

The lack of games certainly doesn't help, but honestly I think the marketing (or lack thereof) is what's doing the most harm here. I barely see any marketing for the WiiU--no TV adverts, no billboards, no internet ads, no nothing. At this point though, I'm not sure what the WiiU can do to gain traction. Considering the difficulties experienced with developing games for the system, Nintendo was probably better off waiting a year to release the WiiU just so they could a) get a better understanding of developing in an HD environment, and b) buffing specs so that it at least has a chance to possibly run any new engines released in the coming years. Releasing earlier honestly brought no benefit to them.

 

[MrHide-Patten]

Look at all these hopeful faces in the comments section, aahhh... ha, ha, hah!

Unless Nintendo releases a Pokemon MMO for the Wii-U I don't see shit selling GTAV style. Here's hoping for a yard sale.

 

[Aiddon_v1legacy]

I'm not worried (Yet) for the WiiU. Yes, it's sales suck hard right now, but with the Price Cut and the avalanche of first party titles coming, I'm hoping that the WiiU will pick up fast.

If it doesn't have a decent Christmas, then I will worry for the WiiU.

Eh, even if it has a sluggish XMas it's not the end of the world. Nintendo doesn't play by the "rules" that people like to think exist, especially since they've always been a company that thinks long-term. Sony and MS are probably thinking no further than XMas while Nintendo is already thinking into next year at LEAST. When Mario Kart and SSB come out they'll be fine no matter what. There's no reason to rush.

 

[AzrealMaximillion]

I'm not worried (Yet) for the WiiU. Yes, it's sales suck hard right now, but with the Price Cut and the avalanche of first party titles coming, I'm hoping that the WiiU will pick up fast.

If it doesn't have a decent Christmas, then I will worry for the WiiU.

I would give it until Smash and Mario Kart comes out. If those can't move enough consoles, nothing else can.

I don't think people will jump on a console when 2-3 games come put for it. I can't see many people justifying spending $300 just to play a new Mario game, a new Smash Bros game, and a new Mario Kart game, then having to wait another year or two for the next Legend of Zelda.

Games will help with the die hard Nintendo fans, which there seems to be less of than people thought if current WiiU sales are an indicator.

Nintendo's weakness here is marketing. They've already given up talking about the tablet controller for the most part and still don't seem to want to promote the third party games on their console. Wonderful 101 flopped real hard and that was the only worthwhile 3rd party exclusive for the WiiU. Now what else is there to talk about until next year?

Mario coming out in November? One game to carry it into the holiday season against the release of 2 new competitors? I can't see things getting better for the WiiU any time soon.

 

[AzrealMaximillion]

I can't wait to see the numbers for the holiday season. 3DS sales are going to skyrocket with the release of Pokemon, leaving it's console counterpart in the dust. Know why the 3DS is doing well? It's because it actually has games! Who'd have thought?!

It took a while for the 3DS to pick up steam though, the Wii U might do the same. Who knows maybe the holiday season might be the start, there will be a lot of parents after consoles and the Wii U is a fair bit cheaper than the Xbone or the PS4.

A lot of parents still don't know the difference between the Wii U and the Wii. That and with only the new Super Mario carrying the WiiU into the holiday season I can't see many WiiU's flying off the shelves.

The $100 price difference won't slant things in Nintendo's favour either due to the growing median age of gamers. The old stand by of parents buying consoles for their kids is quickly dissolving and most gamers are in their 20s and 30s now. They'll get the $00 console of their choice because both consoles have enough features to justify the extra cost.

 

[Vyress]

A lot of parents still don't know the difference between the Wii U and the Wii. That and with only the new Super Mario carrying the WiiU into the holiday season I can't see many WiiU's flying off the shelves.

The $100 price difference won't slant things in Nintendo's favour either due to the growing median age of gamers. The old stand by of parents buying consoles for their kids is quickly dissolving and most gamers are in their 20s and 30s now. They'll get the $00 console of their choice because both consoles have enough features to justify the extra cost.

Yeah, sometimes I wonder whether their situation would be better if Nintendo had just named the damn thing differently. Wii to Wii U sounds more like an alteration of the former rather than a completely new product.

Nintendo -> Super Nintendo -> N64 -> Gamecube -> Wii -> Wii U

They got too greedy/lazy and just wanted the Wii name to carry it's success over to the Wii U, instead of having their new console speak for itself, altogether with a new name. By branding it similarly they alienated the new consumer group they won with the Wii and they are just fine with their Wii cause no new one is out yet, right? And the more well-informed and core gamer groups are looking at the titles and realize that Nintendo still doesn't have that much to offer on the end where it really counts: games.

Once Zelda (not the Wind Waker one), Smash and Bayonetta 2 are out things will be looking up. Whether the Wii U will turn profitable with just those 3... unlikely.
They still have IPs that they are not exhausting like Starfox - they need to release more games.