Nintendo posts biggest Q1 loss in five years

first_imgNintendo posts biggest Q1 loss in five yearsLast year’s profit turns to $232 million loss in the face of collapsing Wii U sales and the absence of new revenue streamsMatthew HandrahanEditor-in-ChiefWednesday 27th July 2016Share this article Recommend Tweet ShareCompanies in this articleNintendoNintendo made a net loss of ‎¥24.5 billion ($232m/£177.3m/€211m) in the first quarter of the fiscal year, its largest Q1 loss since 2011.The company made a ‎¥8.3 billion ($78.7m/£60m/€73m) profit in the same quarter last year, but collapsing sales revenue from its current hardware and software – and, it’s reasonable to assume, rising costs associated with its forthcoming NX console – drove a swing in a negative direction. Nintendo earned ‎¥61.7 billion ($585 million) in revenue during the quarter, down 31% from the previous year.Revenue from hardware sales almost halved, falling from ‎¥44.6 billion to ‎¥25.1 billion ($238m/£182m/€216m). For the most part that was down to the Wii U, which sold only 220,000 units in Q1 – versus 470,000 sold in the same quarter last year. That was still enough to push the system just beyond 13 million units sold life-to-date. The 3DS was more consistent, selling 940,000 units in Q1, compared to 1.01 million units the year before.Software unit sales were up across both platforms year-on-year, from 7.9 million to 8.5 million on 3DS, and 4.6 million to 4.7 million on Wii U. Nevertheless, software revenue declined overall, from ‎¥44.4 billion to ‎¥34.9 billion ($331m/£253m/€301m) this year.Miitomo, the first release under Miitomo’s nascent mobile strategy, certainly boosted revenue in the “Smart devices and IP related income” segment, but perhaps not as much as expected. Revenue for the segment was ‎¥1.6 billion ($15m/£11.6m/€13.8m), up from ¥932 million the prior year, despite Miitomo being released on March 17, and therefore available for the entire three-month accounting period.Related JobsSenior Game Designer – UE4 – AAA United Kingdom Amiqus GamesProgrammer – REMOTE – work with industry veterans! North West Amiqus GamesJunior Video Editor – GLOBAL publisher United Kingdom Amiqus GamesDiscover more jobs in games One can only assume that we’ll see a more significant increase in smart device and IP revenue in Q2, which will be the first to register income from Pokémon Go. Nintendo received a huge boost to its market value in the wake of its release, with almost $17 billion added to its market cap at the peak of the hysteria. However, a statement released last week reminded shareholders that the game was developed and released by Niantic Inc. and The Pokémon Company, in which Nintendo owns only a 32% stake. The company’s share price dropped by 18% almost immediately, and has stayed in roughly that position since then.Nintendo’s revenue forecast for the fiscal year, which it has stated includes projected revenue for Pokémon Go, is ¥500 billion ($4.7b/£3.6b/€4.3b). That is only a 1% increase over the prior year, indicating that Nintendo’s cut of that Pokémon money will do little more than offset the decline elsewhere in its business, and that we’re unlikely to see an NX launch until after March 31, 2017.Celebrating employer excellence in the video games industry8th July 2021Submit your company Sign up for The Daily Update and get the best of in your inbox. Enter your email addressMore storiesNintendo appointing Despicable Me studio head to board of directorsAnimation studio behind Mario movie gains influence as Illumination Entertainment CEO Chris Meledandri expected to join board next monthBy Brendan Sinclair 6 days agoNintendo reports record full-year profits as Switch nears 85m units soldAnd, despite forecasting decline, the platform holder expects console to beat Wii’s 101 million lifetime sales this yearBy James Batchelor 6 days agoLatest comments (5)Neil Young Programmer, Rebellion Developments4 years ago “…that we’re unlikely to see an NX launch until after March 31, 2017.”Haven’t Nintendo confirmed previously it would ship that month? 0Sign inorRegisterto rate and replyBob Johnson Studying graphics design, Northern Arizona University4 years ago Coincidence NX leak appears day before? 4 years ago This article comes off as click bait to me. Yes, profits are down right now. Nintendo’s Wii U sales are down. NX is looming within the next year. They have moved onto the NX obviously. If it wasn’t already promised to come to the Wii U, Zelda would have been pushed to the NX as well. Nintendo is just fine. With the success of Pokemon GO and the new Mini NES console coming holiday. Nintendo is going to bank it later this year. 0Sign inorRegisterto rate and replyAnthony Chan4 years ago I think this article paints a overly “doom & gloom” picture for Nintendo. While they are not absurdly financially ‘rolling’, they are far from dying. I think the drop in profits signals a shift in their strategy and changing of product lines. The Wii U has stagnated and all of us knew that. 3DS sales are still great which is a good sign of their control over the handheld market.With NX being a combination of traditional game console and handheld – hopefully they will be able to capitalize.Finally what Pokemon GO shows, is despite the “immature” nature of their IP, it is still widely popular. They have proven even when its not created in their stables, their IP still pushes sales.I am excited to see what Nintendo has coming down the line for mobile. 0Sign inorRegisterto rate and replySign in to contributeEmail addressPasswordSign in Need an account? Register now. 0Sign inorRegisterto rate and replyBen Link Video Game Enthusiast and Graphic Artist 1Sign inorRegisterto rate and replyShow all comments (5)Richard Browne Head of External Projects, Digital Extremes4 years ago Pokemon Go’s value to them is more the value of their investments in Niantic and The Pokemon Company rather actually cash in the door.last_img

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