Nintendo is being carried by the 3DS
Nintendo have announced their first quarter results for the 2012-13 financial year (April, May & June) and while they are slightly better than last year they are still running at a loss. With sales of the Nintendo DS slowing and the Wii all but non-existant it is left up to the 3DS to make money for the company while they gear up for a big release of the Wii U.
And while sales of the three dimensional handheld are strong, last year’s price cut means that they are making a loss for each and every console sold. Nintendo have reported a net loss of 17.2Bn¥ (approx £141million) in the first three months of the tax year, which is up on the 25.5¥ on the same period last year.
The company expect to be profitable in the next 3 quarters for 3 reasons. Firstly the production cost of the Nintendo 3DS has fallen so they expect to make a profit with each unit sold. The launch of the 3DS XL will no doubt bolster sales of the new device and the old one as consumers take advantage of the old console prices. Not forgetting the next generation home console will be on shelves in time for the busy Christmas rush and if Nintendo get everything right in terms of pricing the Wii U should be seeing a very pretty penny indeed.
From a software standpoint, Nintendo have two Mario games releasing: New Super Mario Bros 2 for the 3DS and NSMBU launching for the Wii U, as well as Luigi’s Mansion 2: Dark Moon and Pikmin 3 which will generate much interest for Nintendo fans.
So things may look bleak in terms of Nintendo’s profitability, however last year was the first time they fell into the red since producing video games, which was due to fans waiting for the next console. In 9 months, things may look different.