As Predicted, Nintendo Posts Massive Loss

Nintendo’s Q2 earnings report is in and it’s sombre reading for the company. They’ve posted a loss over the quarter of $258 million compared to a profit of over $400 million in the same quarter last year.

It’s a massive decline for the company but not as tragic as it might seem. This loss for the July-September period means that Nintendo are just breaking even as they head into the holiday sales period. They’re currently supporting a new hardware platform still barely six months old (the 3DS) and preparing to release another one (the Wii U) next year. That’s a challenging situation for any platform holder and it paints a bleak picture when translated to financial reports.

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It seems that, along with traditional competition from Sony and Microsoft, the rapid encroachment of Apple and Google on the casual games market is the reason for part of the decline. It should also be noted that a declining economy in markets outside of Japan, where Nintendo does 80 per cent of its business, won’t help when the Yen is so strong.

With the busy holiday season ahead and the arrival of some key titles for the ailing 3DS, Nintendo’s next financial report is of much more importance. That won’t stop this one hurting though, it’s depressing reading for the investors, I’m sure.

Source: Reuters

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12 Comments

  1. I wish I could say I lost £258only and not be worried. Working in the billions just doesn’t compute in my head.

    • If you had, you’d get a job at UBS no probs.

  2. Are the development of the new Wii and the Japanese tsunami not factors in these losses?

    • should be but the 3ds price cut is their biggest problem.Software is also down.

  3. Auch. Well the casual market drop you as easy as they pick you up I guess. Karma’s a bitch.

  4. As expected but I hope they get back on track. I’m still hoping for a 3DS dual stick revision and I’m sure I’m not alone.

  5. Nintendo, of all the console manufacturers, is the one that will sell masses at Christmas though. Their consoles and games are more affordable and appeal more to the younger gamers who don’t have disposable income to buy stuff themselves so get it as presents.

    • Exactly. It’s very premature to call the 3DS a failure when it hasn’t had a holiday sales season yet! Not a good sign, for sure, but we’ll see what they do over Christmas…
      Even if the 3DS picks up (as I suspect it will) over Xmas, the Wii has barely anything to do this holiday season so sales /should/ be well down, logically. So if they’re strong it’ll be amazing for Nintendo. This is just a really awkward time in their release cycle.
      Having said that, I still don’t really see where the Wii U fits…

    • iPod touch should be on kids Christmas list higher than a 3DS. Also didn’t kids last year want Apple products more than Nintendos……..

  6. Investors can be as sad as they like tbh, I just hope that Nintendo don’t make the same mistakes with the Wii U as they made with the 3DS.

  7. Thought most console launches hit the red and then built up….Ninty will make some cash over Christmas for def….

  8. So much money. Don’t even get it.

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