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Nintendo swings back to losses, as the Wii U pulls it down
Nintendo swings back to losses, as the Wii U pulls it down
May 7, 2014 | By Mike Rose

May 7, 2014 | By Mike Rose
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Nintendo saw its revenues slump and its profits swing to heavy losses during the last fiscal year, due to terrible Nintendo Wii U sales -- in fact, just 2.72 million hardware units were sold over the last 12 months.

The company noted that while five key first-party releases reached the Wii U during the fiscal year ended March 31, 2014, including Super Mario 3D World and New Super Luigi U, "the Wii U business as a whole showed slow growth."

This means that in the 16 months that the Wii U has been available, it has sold a total of 6.17 million units. Nintendo says the price markdown on the Wii U in the U.S. and Europe is still having a negative impact on financials.

Regarding Wii U software, 18.9 million software units were sold during the last fiscal year, for 32.3 million to-date. Software sales did not grow sufficiently, says the company.

It's not all doom and gloom, as the Nintendo 3DS continues to steam ahead. Pokemon X/Y have now sold 12.26 million copies worldwide, while Animal Crossing: New Leaf has now sold 7.66 million units.

The Nintendo 3DS hardware itself sold 12.24 million units during the last fiscal year, with total sales now reaching 43.33 million.

Interestingly, Nintendo broke this figure down into the separate 3DS models. The 3DS XL sold 7.87 million units during last fiscal year, while the Nintendo 2DS sold 2.20 million. Thus, the original 3DS model sold 2.17 million.

For the fiscal year ended March 31, 2014, Nintendo recorded revenues of 571.7 billion yen ($5.6 billion), down 10.0 percent year-over-year, and losses of 23.2 billion yen ($228.6 million), compared to profits of 7.1 billion yen ($69.9 million) year-over-year.

But Nintendo is hopeful for the next fiscal year. With the upcoming launches of Mario Kart 8 and Super Smash Bros. for Wii U, plus plans to release many Nintendo DS games for the Wii U Virtual Console, the company believe it can turn the Wii U's fortunes around.

Therefore, Nintendo is projecting revenues of 590 billion yen ($5.81 billion) and profits of 20 billion yen ($196.9 million) for the 2014 fiscal year, with estimated 3DS hardware sales of 12 million, and estimated Wii U hardware sales of 3.6 million.


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Comments


Phil Maxey
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Ironically I think the real issue for Nintendo is not actually the hardware, but their platform as a whole. Sony and MS have the whole "home entertainment" platform nailed down. Their consoles are merely conduits into those services. The one area they both play 2nd fiddle on is mobile of course, but on that Apple and Google have things nailed down.

At this point it's very hard to see Nintendo making inroads into consoles or mobile, which I have to admit pains me. The industry needs Nintendo, not just it's iconic games but also it's hardware. But the gap that they can get into is getting smaller and smaller. It would be great to think that Nintendo will launch an amazing new console in a year or two that will offer us something original and uniquely Nintendo and actually fits with what contemporary players want and expect, but I have my doubts that will happen.

A W
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The problem people have with Nintendo is that it's Nintendo. They want it to be something else and its not something else.

Justin Kovac
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PS4 has less home entertainment options than the PS3. Wii U has the primary ones (Netflix, Amazon, Hulu, few others). PS4 has no DLNA, no direct streaming from PC, no 3D Blu Ray, no cable box integration.

And it has outsold the Wii U and leads the One. Shooters, multiplatform games, online play and graphics sell. The Miiverse is a cool built in social gaming platform. PS4 relies on facebook and twitter sharing and a recent activity box of your friends only stuff that is not the best thing. I posts and art on MiiVerse are great.

Daniel Smith
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i had expectations of using the Wii U as a media device when i got it, but the apps and system ui are so poor/slow-to-load that its just not worth it. Far, far, smoother and faster experience to use my phone+chromecast , or even my old Roku.

Crazy really,when the WiiU should easily outperform either of these devices by a considerable amount.

note: i'm mostly happy with my WiiU otherwise, if only for the 2 Mario games! I have 2 young kids, and there's no contest with the other consoles really.

SD Marlow
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They need to embrace WiiWare and digital distribution of 3rd party games. Mario feels like the shallow end of the gene pool and there is zero hope of fresh new 1st party games. While in the minority, I still think a Wii micro console (WiiMii) would do well against Sony's PS Vita TV (should be called Vita Play) and Amazon's Kindle TV (should have been called Campfire).

Jeferson Soler
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@ SD Marlow - I will admit that Nintendo of America needs to do TV commercials about the digital offerings from the eShop, especially since the eShop features the Virtual Console titles and the indie game titles. Digital distribution is just as important as the physical one, in my opinion.

Theresa Catalano
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I really hope that people start wising up and buying Wii-U's. It's a fantastic system, far better than a PS4 or the other one right now. I've been playing mine a lot, and that second screen is so useful for so many situations. I actually agree with Nintendo... I think there are a whole lot of people who are simply waiting for a new Smash Brothers game and a new Mario Kart game before they jump on board. A lot of people I've talked to seem to be on the edge of deciding to buy a Wii-U. I think Nintendo is right to be hopeful for this year, things might actually start to look up for their system after hanging with it for so long. At least I hope so, because they really deserve to.

Jeferson Soler
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@ Theresa Catalano - Fortunately, Nintendo of America will be selling the new Mario Kart 8 bundle as soon as Mario Kart 8 is released and it also helps that there's a special limited time offer for the ones that get Mario Kart 8 early on. That offer is especially helpful on making the price for the new bundle more acceptable (the new bundle is $330, but it comes with a Mario Wii Remote and a red steering wheel shell, so it is worth the money as you do save some money on those accessories). Now, all NoA needs is to make an aggressive marketing campaign for the game, and when I say aggressive marketing campaign, I mean to focus on as many TV channels as possible on all timeslots. All demographics and audiences are important when it comes to Mario Kart 8.

Eric Geer
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I'm sorry but the only problem with the WiiU is the lack of games. I really like the console/controller, I own a handful of games, but that's about all that is available to pick from. I went into Gamestop hoping to trade in somethings and get a WiiU game, I did, and it was Donkey Kong Country Tropical Freeze, BUT that was about the only game I could have picked. The quality titles are few are far between and most of them are Nintendo 1st party.

Justin Kovac
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You have less choices on the PS4. Maybe more new recent ones. But Dec, Jan, Feb, there was nothing "new". Unless you are planning to only game on Wii U. Wii U only means you miss out on Thief, Strider, Don't Starve, Tomb Raider HD and other multiplatform games. As for exclusives, it has the rest library. As for offering a variety for those only wanting one new console and all the new multiplatform games, you are out of luck.

I mostly worried about all these great local multiplayer indie games coming out and them not being on the Wii U but will be on Playstation. Instant buys for me on the Wii U since I have controllers for them. Soon buying 3 more Dualshocks will have good value. Nintendo needs to be the ones to reach out rather than waiting for the indies to reach to them first.

Theresa Catalano
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You're overlooking some amazing games, Eric. Wonderful 101 is such an amazingly well designed game. Pikmin 3 is fantastic. Nintendo Land is good. Recently I've been playing Monster Hunter 3, and if you havent played the Monster Hunter games yet then 3 on the Wii-U is an excellent jumping in point, far better than the portable version.

The Wii-U library is surprisingly solid already. Far FAR better than the PS4 library, or the other one at this point. The problem with Wii-U is NOT the lack of games. I think the problem is more than the Wii-U's good games don't get as much press as they deserve.

Jeferson Soler
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@ Eric Geer - Theresa is right and it doesn't help matters that the marketing team from Nintendo of America is questionable at best when it comes to promoting the Wii U and the games for it. It is not just with NoA. Some of the western branches from Japanese companies tend to be guilty of not promoting some of their games on TV as well. Some people may not even know that the Wii U is getting One Piece Unlimited World Red (which will be digital only in the US, but not on Japan and Europe), for example. The games are there, but promotion outside of the Internet has been very lacking and that has been the main problem.

A W
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The only problem I see with the Wii U is that AAA companies are unwilling to develop games for it because they want Nintendo to die. It's a unified effort in the West to see if they can kill a company by starving it of their games. The east is torn about joining the efforts, but it looks like they are going to be choosing sides really soon.

Jeferson Soler
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@ A W - At this point, it seems like that the Japanese companies (especially the AAA Japanese companies) are starting to side more with Nintendo and Sony. I'm assuming that some of the Japanese companies are doing games for the Xbox systems mostly due to the money involved and/or due to their western branches convincing them to do so. Otherwise, the Xbox systems wouldn't even be getting a single game from a Japanese company. There are people that are just fine with Nintendo systems and/or Sony systems. Most of the problem has been with western mainstream game companies, and while I don't doubt that they seem to have issues with wanting to do games for Nintendo systems, there are times that it seems like those feelings are not exclusive to Nintendo systems. I have a feeling that the majority of game developers would rather do games for computers only and not do games for any game system (portable or home console). On the other hand, when it comes to games that would sell best on a game system, western mainstream companies will not be shy about doing those games for consoles. In case of Activision, I'm assuming that the only reason the company is still working with Nintendo is because of the Nicktoons games and of the Skylanders franchise (the latter being a gold mine when it comes to Nintendo systems).

Theresa Catalano
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Well, luckily for me I don't care too much about games from mainstream western companies, so no big loss there. I'm sure it's not great for thier bottom line, though.

A W
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You are in the minority Theresa, and I can right paragraphs about why, but it would just come of like a rant.

The real reasons western AAA is treating Nintendo like they are is because they want to move to a different way of developing games where everything remains the same across all platforms and Nintendo wanted there to be extra incentives to buy on their platforms. Nintendo didn't realize those extra incentives were just Skype, pay for online services, and 1080p at 60fps. All things which most likely could be don on Wii U but aren't being done as of right now.

A W
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I agree Jeferson right now the eastern companies like Capcom seem to still have some support for the Wii U, but is nothing like the stuff they wish to buzz for the PS4. Even Square Enix has egg on their face given the success of Bravely Default, but I don't see their message being pro Nintendo about it. Their company president just said "OH I see that THAT RPG did well, seems like there is life in that type of RPG after all." Not withstanding that I can argue that each Nintendo FF game from Gamecube till now is just Bravely Default with a FF name (even the characters resemble the CC character designs) but I don't think they see it as we need to make more games like that on Nintendo. They see it as we need to make games like that on the PS4. So I can't hold much hope out for AAA Easter developers sticking with Wii U for their grand titles for long. MH might stay but those other game are gone.

Dane MacMahon
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@ Theresa

Nothing wrong with disliking today's popular games, I do a lot of the time as well, but let's not act like your preferences mean the WiiU has games people are excited about. They are obviously not excited, hence the low sales numbers.

Theresa Catalano
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I think more people would be excited about Wii U's games if more people knew about them. But they just aren't talked about as much, and I blame that on the gaming press. In particular, Wonderful 101 was a brilliant game that was inexplicably brushed aside by the gaming press, and that's a tragedy and a major failing as far as I'm concerend.

Jeferson Soler
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@ Dane MacMahon - Once again, Theresa has a point. In comparison to the 3DS and the 3DS games, there are barely any commercials for the Wii U and for the Wii U games. Some of the Wii U game commercials tend to be about multiplatform games, like the Skylanders games, so those commercials hardly count as a result. I grew up through all Nintendo system generations, and in my opinion, the Wii U marketing campaign in the US is by far the worst marketing campaign for any Nintendo system at the moment. It feels like that the NoA marketing team don't get the different audiences for the Nintendo systems as well as seem to want to do the marketing on the cheap (as in, do Internet-based marketing only). It doesn't help matters that there are people that still believe that the Wii U is just an add-on for the Wii and not a whole new system. If NoA doesn't do a very aggressive marketing campaign for Mario Kart 8 and the MK8 Wii U bundle, then I have to say that it is time to see what the heck is going with the NoA marketing team. US is key when it comes to home console sales.

@ A W - While I agree with what you said, I wouldn't rule out anything at this point. In case of Square Enix, even though this might not mean anything, Sony did recently sell off its Square Enix shares, so if Square Enix decides to get more aggressive with doing games for Nintendo (especially if the company starts to feel that it is time to really let bygones be bygones), it could do so without hesitation (not that there was a hesitation to begin with as Square Enix did do the recent Dragon Quest games for the Nintendo systems among other things). Unless I'm mistake, I believe that the eastern mainstream game developers (even some of the higher-ups in charge) may actually want to do more games for Nintendo, but some shareholders may not be letting that happen due to favoritism/otaku-attitude/bias. There's room for both, Nintendo and Sony (especially since they are not competing against each other, technically), but some shareholders may not see it that way. Even Nintendo's own shareholders are a problem, which is why I feel that Nintendo should go private. By the way, it is not completely common knowledge, but from what I gathered, the Nintendo shareholders are the real reason Gunpei Yokoi left Nintendo and not Yamauchi nor the Virtual Boy failure (Gunpei redeemed himself with Game Boy Pocket before leaving Nintendo). Some shareholders tend to slow down creativity and to worry more about money than about how to really make money.

Dane MacMahon
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@ Theresa

Fair enough. From my perspective as a PC only guy I tend to think the gaming press talks too much about Nintendo games, and hands them 10s out of 10 just for showing up, but I am absolutely sure it depends on the perspective you have coming in.

I do think the WiiU has been much more ignored by comparison, which might be a reflection of how far the Wii went toward the casual market while Xbox shooters and Western RPGs took over the mainstream. Kind of a shame, that.

Eric Geer
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Theresa, how could have i overlooked them, when I didn't even list my library. I already own MH3U and Pikmin 3, as well as some othergames. But again, most are Nintendo 1st party (and Ubisoft) games. There is a pretty solid library but solid doesn't mean large. And the fact that many of the multiplatform games rarely come to WiiU and if they do they are gimped in some way is a shame, cause I would prefer to buy them on WiiU but I'm not going to buy a inferior product.

Theresa Catalano
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Well, I'm just saying that Wii U has a much more solid library than PS4 or the other one. Yet those systems sold a ton without even having libraries. In other words, it has nothing to do with the Wii U's library of games. It's an image or marketing problem. And I'm hoping that will turn around... at the very least, I think Smash Brothers and Mario Kart will be a big help.

Dane MacMahon
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Well if you have little interest in platformers and a lot of interest in shooters, open world games and the like then I would say you would feel the opposite, that the PS4 has a lot of games and the WiiU has very few.

For me personally no console has enough games for me to bother with since I have a good PC and play RPGs 90% of the time.

It's all perspective, really.

Eric Harris
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I think the video game market is changing. I don't believe it is a problem on the Nintendo side of things, but the fact that the major companies are not focusing on producing console games. I think companies like EA, are trying to get higher margins from the casual game/apps market. The result is fewer quality games made for consoles. I think that the majority of people do not wish to see some of the games are being produced. Theresa mentioned she did not like mainstream games, It's probably because the content of the games dividing the audience, kinda like what cable television does. People also don't want to learn a new control scheme. PS4 interface is more or less the same as PSOne. Nintendo should focus on the nunchuk first, then introduce the cool new features with the new controller. Remember folks, no one is buying the XBone as expected either.

Now just using the data available, Nintendo is doing a poor job of marketing games in the USA. Wonderful 101, Monster Hunter, and, Tropical Freeze are some of the best games out period. No one gets exposure to these outside of the internet. The original Wii had a huge ad campaign compared to the current Wii U. To all the folks saying it is the system, I think it is more than hardware and social media features. People are buying tablets and have less money for yet another electronic device. In addition, people expected Nintendo to be the low price leader. So I think some question whether it is worth it.

Jeferson Soler
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@ Eric Harris - And here's the jackpot! Seriously! You are correct on all those points and I would like to add that tablets tend to have low-tech hardware; people can't claim that the Wii U is not selling due to the hardware specs being low, because that is far from the truth as tablets are not exactly high-tech and they are selling by a lot. And assuming that there's some truth to the Wii U being low-tech, so what? After learning more about the history behind Game Boy and behind Gunpei Yokoi, I have to say it is more important for Nintendo to follow Yokoi's philosophy of "lateral thinking with withered technology" than to listen to people that know nothing about the videogame industry.

Jacque Cousteau
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I knew they'd post losses when WiiU was shown for the first time. It's just too out there for the common person looking to buy a new console. Nintendo need to get with the program and lose the hardheadedness when it comes to developing new hardware. Being different isn't always a plus.

Eric Harris
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How is the Wii-U "out there"?

Carl Chavez
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Nintendo loses US$228 million, leaving 'only' $3.3 BILLION in cash reserves, while spending $707 million on R&D (a 25% increase from 2013).

I think they're already preparing for the next platform, and they certainly have enough resources to weather the next few years if the Wii U market completely collapses.

(Source of data: http://www.nintendo.co.jp/ir/pdf/2014/140507e.pdf)

Eric Harris
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Actually even if the console market collapses. Weak sales numbers is not only a Wii U thing. The XBone is also selling below expectations.

tony oakden
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It's the lack of a killer launch title which has hurt the console. It's too late unfortunately and I'm sure the ground Nintendo lost can never be made up now. Even if Mario Kart 8 is totally amazing it's not going to change people perception that the Wii U is just a more expensive Wii and that most everything which is worth playing can be played on the older cheaper console in a prior incarnation. It hasn't helped that Sony has produced a really good product this time around either, but I think Nintendo have mucked up on this one. Which is a shame because I really like the Wii U and my son and daughter enjoy playing games on it. We have Mario Kart 8 on pre-order. it will be good, most everything first party is, but it won't save the console.


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