Posted January 30, 2013 Nintendo's Return to Profit Thanks to Currency Changes But decline in sales is slowing... Nintendo has released its financials for the nine months from April 1st to to December 31st 2012 and the company is quoting a very uplifting set of figures, which indicate that it has - year on year - returned to profit. The figure being quoted by much of the media is the one for "Net income". This shows a positive of ¥14,545 million compared to the previous period of - ¥48,351 million (yes, minus). Excellent, but then we note the official statement by the company and match this to the trend of actual sales since 2008... The statement from Nintendo reads, "While Nintendo saw year-on-year increases in the sales of Nintendo 3DS hardware (up 11 percent YOY) and software (up 41 percent YOY), those gains were not enough to offset decreased sales of Wii and Nintendo DS hardware and software. "Furthermore, the strength of the yen averaged against the euro in the first nine months of Nintendo’s fiscal year contributed to an overall 2.4 percent year-on-year decrease in sales." Bad news on sales in fact. In fact, let's look more closely at sales using the figures given to us by Nintendo. Net Sales in millions of yen FY3/2009 - (Apr.-Dec.'08) - ¥1,536,348 (-) FY3/2010 - (Apr.-Dec.'09) - ¥1,182,177 (-￥354,171) FY3/2011 - (Apr.-Dec.'10) - ¥807,990 (-￥374,187) FY3/2012 - (Apr.-Dec.'11) - ¥556,166 (-￥251,824) FY3/2013 - (Apr.-Dec.'12) - ¥543,033 (-￥13,133) So, sales have consistently been down. That, for a company that makes money by making and selling physical things is not a good sign. However, the last nine month period has shown that the downward trend has eased significantly. But still not enough to show a rise on profit. So where did the return to profit come from? Nintendo points out that, "the company has returned to profitability in ordinary income and net income levels, driven primarily by foreign currency exchange gains." Our italics. Yes, fluctuations in currency exchanges which, as we're all aware can fluctuate negatively as well as positively, are by Nintendo's own admission, primarily responsible for its return to profitability. It further reinforces this and points out that: "Owing to the fact that the 'Wii U' hardware sales have a negative impact on Nintendo’s profits, the operating loss was 5.8 billion yen. As a result of exchange gains totaling 22.2 billion yen due to the depreciation of the yen at the end of calendar year 2012, however, ordinary income was 22.7billion yen and net income was 14.5 billion yen." So, on the one hand while Nintendo's figures and statements indicate a return to profit based on the notoriously flaky basis of foreign currency. On the other hand, the sales trend, while still downward, is significantly less steep in decline than previous periods. Before we go... some essential figures for hardware sales that can be used in future fanboy arguments. Apr-Dec 2012 vs Lifetime Nintendo DS - Hardware - 2.15 vs 153.67 - Software - 30.24 vs 930.55 Nintendo 3DS - Hardware - 12.71 vs 29.84 - Software - 39.56 vs 84.99 Wii - Hardware - 3.53 vs 99.38 - Software - 45.08 vs 863.53 Wii U - Hardware - 3.06 vs 3.06 - Software - 11.69 vs 11.69 Nintendo's Return to Profit Thanks to Currency Changes Nintendo to post unexpected loss as Wii successor falters Nintendo cuts Wii-U sales forecast This is something that nobody has mentioned here, Nintendo's return to profit has been mainly due to the depreciation of the yen in spite of the poor Wii U sales. Share this post Link to post Share on other sites
Posted January 30, 2013 Apr-Dec 2012 vs LifetimeNintendo DS - Hardware - 2.15 vs 153.67 - Software - 30.24 vs 930.55 Nintendo 3DS - Hardware - 12.71 vs 29.84 - Software - 39.56 vs 84.99 Wii - Hardware - 3.53 vs 99.38 - Software - 45.08 vs 863.53 Wii U - Hardware - 3.06 vs 3.06 - Software - 11.69 vs 11.69 Seeing that makes me think it's done well. I didn't think it'd have sold anywhere near as much as the Wii. It also reminds me that even the mighty DS had a quiet start. I remember I didn't buy one until the DS Lite and Phantom Hourglass. Share this post Link to post Share on other sites
Posted January 30, 2013 (edited) Interesting, thanks @Wii! This is where I get completely out of my depth - economics isn't my strong suit - but certainly worth noting all the same. Why 'lifetime' Wii U sales are relevant as a comparative distinction at this point though is anyone's guess. The thing I find rather frustrating about this discussion is that it seems to always be pulling in one direction, when the figures are resolutely in the middle. 3 mill vs 3.5 mill is by no means the disaster so many want it to be (mitigations or no!). There's also no doubt it's not peachy and Nintendo have a lot to do to make the console the roaring success they hoped it would be. Edited January 30, 2013 by Lens of Truth Share this post Link to post Share on other sites
Posted January 30, 2013 (edited) Interesting, thanks @Wii! This is where I get completely out of my depth - economics isn't my strong suit - but certainly worth noting all the same. Why 'lifetime' Wii U sales are relevant as a comparative distinction at this point though is anyone's guess. The thing I find rather frustrating about this discussion is that it seems to always be pulling in one direction, when the figures are resolutely in the middle. 3 mill vs 3.5 mill is by no means the disaster so many want it to be (mitigations or no!). There's also no doubt it's not peachy and Nintendo have a lot to do to make the console the roaring success they hoped it would be. You have to remember the 3 mil is shipped to retailers. We dont know just yet what the sold to consumers figures are like. I dont think anyone wants it to be a disaster. I'm just frustrated with how nintendo have gone about launching it and that goes as far back as E32011. So many mistakes and lessons not learnt from the 3DS launch. Edited January 30, 2013 by liger05 Share this post Link to post Share on other sites
Posted January 30, 2013 Getting back to that irritating Wii U ad from the U.S. here it is in all it's glory: If you want to make the console look like a fisher-price toy and make peoples ears bleed, then mission accomplished. Share this post Link to post Share on other sites
Posted January 30, 2013 Getting back to that irritating Wii U ad from the U.S. here it is in all it's glory: If you want to make the console look like a fisher-price toy and make peoples ears bleed, then mission accomplished. messed up dubstep music!! The marketing and advertising campaign needs a complete reboot from scratch but no point now as the software isnt there. Once more games are on the horizon they need to basically treat it as launch again. considering Reggie is a marketing guy he needs to step the fcuk up and make sure there is a real decent campaign!! Share this post Link to post Share on other sites
Posted January 30, 2013 (edited) Can I just remind you that their advertising is not aimed towards us, and people like us. They've already made their decisions. I'm not saying that ad is good, but you guys seem to forget the target audience for adverts Edited January 30, 2013 by Serebii Share this post Link to post Share on other sites
Posted January 30, 2013 How about this video so? This is the latest video for Aliens: Colonial Marines. Still no mention of the Wii U boxart at the end. News on this game has gone dead lately. People are starting to fear this game has been cancelled. Surely it can't be cancelled? Share this post Link to post Share on other sites
Posted January 30, 2013 Can I just remind you that their advertising is not aimed towards us, and people like us. They've already made their decisions. Who is it aimed at then? The nintendo core may of made there decision but they still want to attract 360/PS3 owners. If its just aimed at the casual then it still falls well short. It blows. They can do much better than that. How about this video so? This is the latest video for Aliens: Colonial Marines. Still no mention of the Wii U boxart at the end. News on this game has gone dead lately. People are starting to fear this game has been cancelled. Surely it can't be cancelled? Its not coming out on the same day. Its got a later release. Share this post Link to post Share on other sites
Posted January 30, 2013 Its not coming out on the same day. Its got a later release. It got a vague Q1 release date a while ago but I haven't heard anything lately specifically regarding the Wii U version. Wouldn't they want to let the masses know it's on its way soon? Share this post Link to post Share on other sites
Posted January 30, 2013 It's all in the language. 'Shipped' is not a good sign. That's the kind of rubbish Microsoft resorted to with Kinect, though not as bad as Sony who just lump PSP and Ps Vita sales together. In a pretty unrelated note, this puts into perspective how absurd the number of iPad Apple sold last year, alone. Something like 97 million units. That's tremendous. Share this post Link to post Share on other sites
Posted January 30, 2013 What I like about that US ad is the design of the coloured rooms making up the "U". At the very least it's a visual concept (compared with the terribly slapdash UK ones). Also the cynic in me says that consumers these dayslike to feel commodified - being in your designer blank room/box is the ultimate in post-modern "comfort". What is awful is the music, the editing and the slogan. Share this post Link to post Share on other sites
Posted January 30, 2013 It's all in the language. 'Shipped' is not a good sign. That's the kind of rubbish Microsoft resorted to with Kinect, though not as bad as Sony who just lump PSP and Ps Vita sales together. In a pretty unrelated note, this puts into perspective how absurd the number of iPad Apple sold last year, alone. Something like 97 million units. That's tremendous. Nintendo will announce the sales figures. They always release the shipped numbers first. Share this post Link to post Share on other sites
Posted January 30, 2013 EA doesn't consider Wii U a next-gen console This blurb was spout out by EA during their fiscal earnings report... "What we're describing as gen four has yet to come." Nice to know that EA only considers graphical power the true next-gen qualifier with hardware. That's an opinion that'll surely take them far! http://gonintendo.com/?mode=viewstory&id=195217 From the same conference: "40 minutes into this EA investors call and I don't think they've mentioned Wii U once". https://twitter.com/jasonschreier Share this post Link to post Share on other sites
Posted January 30, 2013 Nintendo will announce the sales figures. They always release the shipped numbers first. I wonder why they even mention shipped figures at all then. That'll be an interesting figure, this is pretty redundant. Share this post Link to post Share on other sites
Posted January 30, 2013 (edited) EA doesn't consider Wii U a next-gen console This blurb was spout out by EA during their fiscal earnings report... "What we're describing as gen four has yet to come." Nice to know that EA only considers graphical power the true next-gen qualifier with hardware. That's an opinion that'll surely take them far! http://gonintendo.com/?mode=viewstory&id=195217 From the same conference: "40 minutes into this EA investors call and I don't think they've mentioned Wii U once". https://twitter.com/jasonschreier All is not well between nintendo and EA but I aint blaming Nintendo for that!! I wonder why they even mention shipped figures at all then. That'll be an interesting figure, this is pretty redundant. not really as they have to tell investors how many units they are actually producing. Retailers orders are an indicator of what the retailers demand is like from consumers. Edited January 30, 2013 by liger05 Share this post Link to post Share on other sites
Posted January 30, 2013 Nice to see that their shareholders at least called out EA on their shabby treatment of the Wii U. Hopefully they'll ring them by the neck when the Wii U does take off and EA continue to ignore the console... Share this post Link to post Share on other sites
Posted January 30, 2013 Nice to see that their shareholders at least called out EA on their shabby treatment of the Wii U. Hopefully they'll ring them by the neck when the Wii U does take off and EA continue to ignore the console... Where did you see that? Share this post Link to post Share on other sites
Posted January 30, 2013 Nice to see that their shareholders at least called out EA on their shabby treatment of the Wii U. Hopefully they'll ring them by the neck when the Wii U does take off and EA continue to ignore the console... Will be interesting to see if BF4 comes to the Wii U as EA did say BF was coming at E32011 Share this post Link to post Share on other sites
Posted January 30, 2013 EA have always been graphic whores but yeah, their Nintendo relationship seems more strained than usual, already. I think they were burned with the Wii as they couldn't put their AAA titles on the console and milk their annual titles. Ultimately their casual titles were hit and miss. It was if they couldn't find their feet on Wii. With Wii U Nintendo promised the core gamer would be a focus which appeals to EA. The whole 'origin' rumour seems to have turned things sour though. Share this post Link to post Share on other sites
Posted January 31, 2013 EA have always been graphic whores but yeah, their Nintendo relationship seems more strained than usual, already. I think they were burned with the Wii as they couldn't put their AAA titles on the console and milk their annual titles. Ultimately their casual titles were hit and miss. It was if they couldn't find their feet on Wii. With Wii U Nintendo promised the core gamer would be a focus which appeals to EA. The whole 'origin' rumour seems to have turned things sour though. There was nothing stopping EA and others producing core games on the wii but so many of them produced shovelware as they thought that was the easy cash in. The wii had such a huge userbase and it was crazy how 3rd parties didnt try harder to get a slice of the pie. Share this post Link to post Share on other sites
Posted January 31, 2013 Seeing that makes me think it's done well. I didn't think it'd have sold anywhere near as much as the Wii. It also reminds me that even the mighty DS had a quiet start. I remember I didn't buy one until the DS Lite and Phantom Hourglass. Ithink your getting confused. These aren't launch numbers,n these are 2012 numbers. So it didn't beat the wii when the wii was pretty much dead. Share this post Link to post Share on other sites
Posted January 31, 2013 Some kind of Nintendo fiscal meeting going on right now and this person is tweeting the transcript live - https://twitter.com/gibbogame Share this post Link to post Share on other sites
Posted January 31, 2013 Glad they have acknowledged the UK as a problem spot! Share this post Link to post Share on other sites
Posted January 31, 2013 I know Ireland doesn't compare in size to other markets but Wii U has a massive problem here as well. Share this post Link to post Share on other sites
