3DS Sales Momentum in U.S. and Europe is 'Not so Good'
Posted by Thomas Whitehead
When it comes to sales in Japan, 3DS has been the undisputed number one for a number of months, finishing top of the hardware charts and often out-selling all other consoles combined. The story elsewhere, however, isn't as rosy, and while we're probably not looking at poor sales of the level that prompted a significant price-drop last year, it's still an issue for Nintendo.
The question of 3DS sales came up when shareholders raised the issue of declining share prices to Satoru Iwata; he admitted that the handheld was, at the moment, part of the problem.
What we should say first is that while the Nintendo 3DS has a certain degree of sales momentum in Japan, the momentum in the U.S. and Europe is currently weak. To be more specific, sales of the Nintendo 3DS are constant in Japan and in fact we could say the sales volume is exceeding our forecast at the start of this fiscal year. After the beginning of this calendar year, the average unit sales have been 83,000 units on a weekly basis. This means that about 55% of all gaming hardware sales in Japan consist of the Nintendo 3DS. Now, with the level of sales momentum for the Nintendo 3DS created since the last year end, we would say the center of the Japanese video game market has been the Nintendo 3DS. This scenario is the scenario we were drawing at the beginning and in that regard, the growth is steady.
On the other hand, sales momentum in the U.S and Europe is not so good. Considering that the U.S. and European markets are larger than the Japanese market in terms of the size of the population, sales in the U.S. and Europe are supposed to be larger. At the year end of 2011 the sales momentum in those markets increased in the same way as in Japan; however, the sales pace went down after the beginning of 2012. As a result, the sales proportion of the Nintendo 3DS is now about 20% of the total video game sales in those markets. Thus, solid sales momentum has not been created. For those investors who understand this situation, they might think that our earnings situation will not turn around in the way we have mentioned, or they might think it will take a much longer time than we expect to revitalize the profit situation. With the Nintendo 3DS XL I just spoke about and our key titles, such as “New Super Mario Bros. 2,” to be released globally this summer, one of our immediate top-priority missions is to create sales momentum which can wipe this type of concern away at an early stage.
Iwata went on to make valid points about the differing cultures, where handhelds are far more prominent in Japan than elsewhere. That said, a 20% market share for the newest console on the block, apart from the PS Vita, is still fairly low. The arrival of Mario last Holiday did boost those sales in the U.S. and Europe, so Nintendo will be hoping for a similar boost when the famous plumber returns, with 3DS XL in tow, this August.