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Nintendo: Wii U "Still Has A Negative Impact On Profits"

Author:
Jonathan Lester
Category:
News
Tags:
Financials, Nintendo, Wii U

Nintendo: Wii U "Still Has A Negative Impact On Profits"

Less Than 500,000 Sold Over Six Months

Nintendo have reported a small overall profit in their latest quarterly financial report, but blame the Wii U for underperforming yet again. It's a catch-22: sales are up, but the price cut means that they're still not making any serious money. Plus, "up" is a distinctly relative term.

All hinges, then, on this Christmas.

In terms of raw numbers, Nintendo posted profits of $6.1 million, a relatively slim figure that they largely credit to "exchange gains" following the depreciation of the Yen (plain/grossly oversimplified English: they're still making money via financial forces beyond their control).

The Wii U's sales have picked up from 160,000 in the last quarter to 300,000, largely down to the release of several first-party exclusives such as Pikmin 3, but this means that less than half a million consoles have been sold in the last six months worldwide. An operating loss of $236.2 million was laid at the door of Wii U marketing - something we find hilariously difficult to believe - and R&D, while the increased sales haven't led to any extra money due to the price cut.

"The Wii U hardware still has a negative impact on Nintendo's profits, owing mainly to its markdown in the United States and Europe," said the company in a statement, which we feel is somewhat disingenuous. The fact is that the console simply isn't selling, and the marketing is either non-existent or deeply confusing. Nintendo needs to broadcast a coherent message about the Wii U's appeal, features and upcoming software.

That said, it's worth noting that the increased sales due to the release of The Legend Of Zelda: Wind Waker HD haven't been included in the report, which is accurate up to the end of September 2013, and we've argued that the Wii U will probably fare fairly well over Christmas. It will need to, since Nintendo are still sticking to their guns both in terms of annual financial forecasts and projected sales of 9 million Wii U consoles before next March.

Elsewhere, the 3DS is still bringing home the bacon, with overall sales down but 34.98 million units flogged since launch, and 27.38 million units of software sold during the last quarter. Again, these figures were accurate at the end of September 2013, so the effect of Pokemon X and Y (and the 2DS) haven't yet kicked in.

This Christmas is going to be very important for Nintendo. Will a cheap price, small selection of great games and a potentially lucrative Tesco partnership secure the ailing console the increased install base it needs?

Add a comment8 comments
Late  Oct. 30, 2013 at 12:51

The games catalogue is finally starting to look respectable, so they're ticking one of the boxes.

Tis an expensive time of the year, though, and I've bought a "proper" console, so it'd have to be ridiculously cheap (£100 ballpark) for me to take a punt on the Wii U.

If my kids were a bit younger or more into gaming that threshold would be a bit higher. If you can get your hands on the console for less than £200 there'll be a lot of parents buying them for the kids.

Can't see them getting close to 9m unit sales by next March.
They've sold less than 4m to date (3.91m @ 30/09/13 according to wiki)...

ChrisHyde  Oct. 30, 2013 at 14:57

$236m on Marketing? Where?

Someone is clearly being paid too much to do very little.

Price cuts are only going to work if people see it as a viable option. Making people take notice of the good games available with this cheap machine may work (especially give the relatively weak launch line ups of the next gen consoles), but it's not guaranteed.

With no shouting about price and library, Ninty will miss this Christmas, which would be a massive shame.

Shadowmancer88  Oct. 30, 2013 at 23:53

Nintendo need to change their PR or do more of it.

But the main problem is that most people still think it is an add on for the Wii instead of a new console in itself.

They had over a year to get it right or change it with the nex gen consoles only weeks to release Nintendo are looking at another Gamecube situation.

RiKx  Oct. 31, 2013 at 09:07

Had my offer through the door recently of 2000 Clubcard points if a buy a WiiU from groTesco's. S'pose that might work on middle class Sandra looking to buy little Johnny something else for Christmas...After all those other gameythingies are incredibly violent. Not exactly a massive incentive though.

MikeBeaver  Oct. 31, 2013 at 20:11

Just keep an eye out on eBay, there are deals to be had.
I picked up mine for £160 delivered, only the 8gb model, but came with NSMB U and Windwaker HD, all hooked up and STILL I am playing GTA V instead of WW HD :p


Mike..

Ian01  Nov. 3, 2013 at 15:54

Had my offer through the door recently of 2000 Clubcard points if a buy a WiiU from groTesco's. S'pose that might work on middle class Sandra looking to buy little Johnny something else for Christmas...After all those other gameythingies are incredibly violent. Not exactly a massive incentive though.

I got mine through last week and I think it's enough to tip the balance. I've got young kids and had been put off by the combination of price and lack of games. This offer makes it £40 - 80 off the bundle price, which is £239 at Tesco anyway. By the way I'm not called Sandra and am currently making my way through GTA V. ;)

RiKx  Nov. 3, 2013 at 23:23

By the way I'm not called Sandra and am currently making my way through GTA V. ;)


http://www.splitreason.com//Product_Images/821d77fa363f.jpg

carlasneller  Nov. 27, 2013 at 18:36

Had my offer through the door recently of 2000 Clubcard points if a buy a WiiU from groTesco's. S'pose that might work on middle class Sandra looking to buy little Johnny something else for Christmas...After all those other gameythingies are incredibly violent. Not exactly a massive incentive though.
IF YOU [email protected] WANT THE OFFER OF 2000 EXTRA POINTS CAN I HAVE IT!!?? PLEASE?? I NEVER GOT ONE AND WANT TO BUY!

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