News Article

Nintendo Posts 43 Percent Revenue Drop

Posted by Patrick Elliot

For the first time in two years, the Big N posts a quarterly loss

There has been many-a-meme relating to the DS “printing money,” but now a quarterly earnings report from Nintendo suggests the handheld's printer may be running out of ink.

According to the earnings report, which covers the second quarter of fiscal year 2010/2011 running from April 1 through June 30, 2010, demand for the DS has dropped sharply across the globe. The company was able to sell about 3.15 million units worldwide, down from 5.97 million units the same time last year. In the US, sales for the DS plunged 33 percent last month alone. All this comes as the Japanese Yen strengthens against a weakening Euro and Dollar, further reducing Nintendo's earnings abroad.

In its consolidated financial highlights, Nintendo said a lack of software was partly to blame for the platform's poor performance, adding that the new price drop didn't help either.

The lowering of the price of Nintendo DS hardware in Japan and Europe has adversely impacted net sales and operating income.

Furthermore, with a release date pending for Nintendo's next handheld, the 3DS, it’s possible that many consumers are simply holding off on their purchase.

On a positive note, sales of the Wii kept chugging along, moving 3.04 million units worldwide for the quarter, up 36 percent from the same time last year. This was helped in part by strong sales of Super Mario Galaxy 2, which sold over 4 million copies worldwide since its May release. Other successful Wii games for the quarter include Wii Sports Resort (3.02m), Wii Sports (2.73m), Wii Fit Plus (1.87m) and New Super Mario Bros Wii (1.1m). Nintendo's WiiWare service has done well too, growing by 60 million USD in 2009.

[via nintendo.co.jp, bloomberg.com]

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User Comments (35)

Zach

#2

Zach said:

Congratulations everyone, we finally posted a financial story without a picture of Wario.

rmasoni

#4

rmasoni said:

Probably because everyone in the world already has a DS. In every color.

Sylverstone

#5

Sylverstone said:

I'd be shocked to see Wario broke, but at least Mario's doing his part!

Yes, the transitional phase is beginning......

Klapaucius

#6

Klapaucius said:

" with a release date pending for Nintendo's next handheld, the 3DS, it’s possible that many consumers are simply holding off on their purchase."
This.

sykotek

#7

sykotek said:

JK is responsible for Nintendo losing money!? Burn him at the stake! Oh, wait..., nevermind, I have to read more carefully instead of just the title and picture.

HolyMackerel

#8

HolyMackerel said:

FYI Nintendo didn't report losses, just less revenue. In other words, they still made money and sales, just less than previously.

And this was inevitable, as others have said, the DS hardware market is nearing saturation so a drop in sales must occur.

If Nintendo was actually making losses then they'd be scrambling to do something about it, rather than casually mentioning the DS price drop and the future 3DS release date announcement.

James

#9

James said:

Bloomberg says:

Nintendo Co., the world’s largest maker of video-game consoles, posted its first quarterly loss in more than two years as the stronger yen cut the value of overseas earnings and demand for DS handheld players fell.

The net loss was 25.2 billion yen ($289 million) in the three months ended June, compared with a 42.3 billion yen profit a year earlier, the Kyoto-based company said today. The game maker said it booked a foreign currency-related one-time loss of 70.5 billion yen.

moosa

#10

moosa said:

I honestly feel sorry for anyone who is buying a DS right now. The 3DS is just around the corner.

JGMR

#11

JGMR said:

"Probably because everyone in the world already has a DS."

Exactly my thoughts! Same story applies to the Wii...

What are they expecting? That success will be unlimited?

suburban_sensei

#12

suburban_sensei said:

Their software sales will make up for it with all the great titles coming out now, until the 3DS release...and then that little gem will make them an ungodly amount of cash.

HanuKwanzMasBif

#14

HanuKwanzMasBif said:

Maybe it wasn't a good idea to reveal the 3DS so much time in advance. Oh well, I already have a DSi (not worth upgrading to XL, I'm- well- saving for 3DS).

hulklol123456789

#17

hulklol123456789 said:

Yeah thats happend to nintendo, if people don't get the DSiWare last year, they are not going to ge it these year, the are of-course waiting for the 3DS, and well last year was the year when the DSi went out so...

Token_Girl

#19

Token_Girl said:

This would be expected at the end of a console's lifecycle where people aren't buying them anymore (and all the big selling software titles are being developed for he next console, so game sales can't soften the blow), but they're still sinking lots of money in getting the next console up and running.

Spoony_Tech

#20

Spoony_Tech said:

I don't feel sorry for anyone buying a dsi as is a wonderful system with a great library of good games. The only thing I would do is hold off on downloading any games to see if they have a transfer option which I doubt they will

Akio

#21

Akio said:

Nintendo must have already known that they announced 3DS too early before the release date and that must certainly lead to the sharp drop of DS sales. And also, I am dying for Wii HD. All games on xbox 360 and ps3 seem to have a deep preparation and serious investment and the majority games on Wii are shovelwares. Plz Nintendo, the next generation of Wii should be in your R&D Department !!!!!!!!

SolarJetman

#22

SolarJetman said:

Great pic of Mario. Please send him to my house. We're having a party, and I'd like some of what he's selling.

Crystalking18

#23

Crystalking18 said:

"There are more houses with a DS than there are houses with central heating" Ben "Yahtzee" Croshaw

JebbyDeringer

#24

JebbyDeringer said:

If they release a fart simulator for the DS they should bounce right back to last years earnings.

NintyMan

#25

NintyMan said:

I guess you can sell so much until most of the world has it. Now those that have it will save to get the 3DS, further making Nintendo big bucks. The Wii is still doing good too.

Klapaucius

#26

Klapaucius said:

If its down to the strength of the Yen against foreign currencies, then to combat that it means the 3DS will be more expensive outside Japan, perhaps.

Hardy83

#27

Hardy83 said:

Probably a mix of 3DS, VERY poor software support (even by Nintendo), the fact it's a 6 year old system and it's probably just reach as many people as you're going to reach, probably a dabble in Apple taking some sales away from them.

Either way, they are still profiting on it, not losing. And the 3DS will sell millions so Nintendo isn't going broke any time soon.

Slapshot

#29

Slapshot said:

..... and this is EXACTLY what Ive been screaming for the last year. The whole casual buisness that Nintendo jumped into head first was a fad. The majority of them are off playing with there iPhones, Droid, iPads now insead of there DS and Wii. They buy whats hot and new and dont stick around for buisness loyalty.

Nintendo obviously has fixed the issue as we have seen the titles coming for Wii and 3DS in the future lean more to the core Nintendo gamers and not casual and NSMBWii and Galaxy 2 both had much more difficulty infused into the gameplay putting them both back on par with Sunshine and Mario 64.

Microsoft look ^^^^^! See those revenue losses? That is you next year if you keep this casual thing that you have jumped into full force! Sad thing is you have taken RARE down with you!

wildMissingnoappered

#30

wildMissingnoappered said:

The only reason that microsoft still makes xbox is because they have 65 billion dollars to fall back on. I doubt they would not be still in the market right now without their money they make in the computer indestry.

jack0

#31

jack0 said:

i wonder what the stroy is goinmg to be when the 3ds is released "Nintendo beats all selling records," followed by "Nintendo price revenue up 100% :P

ratman

#35

ratman said:

Nintendo did this to themselfs. Make the dsi, then come out with dsi XL and as soon as they did that tell people to look for the 3DS.
Nobody wants to buy something if your comming out with something better in a few months. Stop the fast pace of tring to rip the public with new this new that and make something we will like for awhile and buy more stuff for. Should of learned from playstation.

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