News Article

Nintendo Confirms Wii U Will Be Sold At A Loss

Posted by Orla Madden

Still think it's expensive?

Nintendo confirmed during its second quarter financial results briefing that Wii U will be sold at a loss. This may come as a slight shock to some considering Wii U is launching at a relatively high price, and suggests Nintendo won't be in a position to change the pricing for some time. We can't imagine what cost it would be if Nintendo wasn't running at a loss.

Satoru Iwata, Nintendo President and CEO, made a statement at the briefing:

In addition to the yen's continuous appreciation, the Wii U hardware will have a negative impact on Nintendo's profits early after the launch because rather than determining a price based on its manufacturing cost, we selected one that consumers would consider to be reasonable. In this first half of the term before the launch of the Wii U, we were not able to make a profit on software for the system while we had to book a loss on the hardware, which is currently in production and will be sold below cost. Our loss has therefore widened during the second quarter in spite of bringing the Nintendo 3DS hardware back to profitability. Although we expect our financial performance to be revitalized, under these circumstances, unfortunately we cannot say that we will achieve "Nintendo-like" profits within this fiscal year.

However, Iwata adds that Nintendo will aim to return to high profit margins next year by launching the Wii U successfully. The company is currently aiming to shift 5.5 million Wii U consoles through to 31st March, 2013.

[via eurogamer.net]

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User Comments (76)

19Robb92

#2

19Robb92 said:

I'm surprised to hear that. But I'm glad they're doing it. I was expecting it to be $400 or more, $350 is perfect.

ajcismo

#5

ajcismo said:

Not surprised. Its a good price point and wise not to gouge the consumer. After playing with one at a demo stand at Gamestop, I can see why they're taking a loss to start since that tablet can't be cheap to fabricate. Probably not much of a loss, in theory the components should go down in price as they produce more units. Expect to see an even more massive push for digital downloads to save on costs in software production to make up for it.

erv

#8

erv said:

It is cheap. It is powerful, has advanced controller tucked into it, has finetuned hardware and technology - I can't believe how people consider this an expensive console.

CanisWolfred

#9

CanisWolfred said:

Yeah, I figured. I still don't like the price, but I guess nothing can be done about that just yet.

Mahe

#10

Mahe said:

The price of the hardware isn't the problem, it's the games. If there was a new Wii Sports, an Excite game, a Metroid game on the level of Metroid Prime or Super Metroid... games like those would make the deal sweeter.

MAB

#11

MAB said:

Kinda figured they were taking a loss because I paid the same price for the WiiU as I did my Wii 6 years ago ;)

CanisWolfred

#14

CanisWolfred said:

^It's still a new console. They may drop it about 30-50 dollars once the "cult of the new" has worn off in about a year, which should put it back where the PS3 is now.

Punky

#15

Punky said:

if people think this is expensive wait until the next xbox and ps are announced....seeing as some people think they are going to be three times as powerful

Mk_II

#17

Mk_II said:

if you look at what you're getting in the box, the Wii U really isnt that expensive. The Gamepad alone probably costs about 80 to 100$ to produce now. But those numbers will drop once the technology gets cheaper and economy of scale kicks in.

Zyph

#20

Zyph said:

@SkywardLink98 That's not the point. Like they said you're comparing prices with a 6 year old console with old tech and obviously with lower manufacturing costs. Wii U has modern tech built-in with features not present in any current console so obviously the high manufacturing costs and the current price tag. It's not how long it will keep you entertained or will it compete with Wii U for a while. Just because your PS3 can make you entertained longer does not mean they can just lower the price just for that. You got to factor in WHY they made that price point in the first place.

hydeks

#21

hydeks said:

@SkywardLink98 I completely agree with you, and yes, I also think the Wii U is overpriced still :P Whatever, Nintendo fans can pay more for basicly the same thing as a PS3 if they want :P Me personally, I'm loving my PS3, and have no need for the Wii U. Nintendo has lost my vote, sorry to say :( There still publish great first party games, but they feel like there 7 years behind everyone else.

CanisWolfred

#22

CanisWolfred said:

@Zyph Exactly. There's a lot to factor in when it comes to cost, more than just what the consumer gets out of it. You have to think about R&D, Distribution, Marketing, Manufacturing (altering existing factories, building new ones, getting parts and supples to build the product, manpower)...it's not as easy as seeing what everyone else is charging and pricing them according to that, or trying to figure out how much entertainment the consumer can get compared to other products (which would be stupid. A new console would obviously have less gamers than an old one). Now, that's not to say everyone should pay a price they think is high, but it's good to understand why the price is there in the first place.

Zyph

#23

Zyph said:

Just wait till the next PlayStation and Xbox comes out. Now those are obviously gonna be expensive (IMO at least)!! :)

steamhare

#24

steamhare said:

I suspect somebody who buys consoles 6 years into their lifespan is not the audience Nintendo is expecting to buy the Wii U at launch. I don't know why someone like SkywardLink, who has implied they buy systems when they've got 6 years of games on the market, would have enough interest in the Wii U to directly compare it to the PS3...

TrueWiiMaster

#25

TrueWiiMaster said:

@hydeks
"Whatever, Nintendo fans can pay more for basicly the same thing as a PS3 if they want"
Dude, practically the only spec that's been confirmed is that the Wii U has 2GBs of RAM, way more than the PS3. As for general hardware, the PS3 doesn't come with a tablet. If you're counting the Vita, bring the price to $500 minimum. Nintendo fans aren't buying Nintendo's version of the PS3. They're buying Nintendo's revolutionary next gen system, and it's well worth the price.

AVahne

#26

AVahne said:

@SkywardLink98
You're comparing 7th generation to 8th generation.
And it'll be staying around, just the same way PS2 was around for a while.
It's not competing with Wii U at all, it's just Sony's way of giving people an option so they can finally start making money again to make up for their losses.

AVahne

#27

AVahne said:

Next generation console with more RAM and huge potential, what with the new controller and the huge boost in graphics capabilities over 7th generation consoles? Very affordable and very cheap!

Sjoerd

#28

Sjoerd said:

I think we can stop bashing @Skywardink98 now.. It's his opinion.
I think buying a console in this late lifespan isn't that bad of an idea.

Look at the backlog of games one can play for practicly nothing.
I'm not really attracted to Sony's marketing or their products as a whole. but seeing you can buy a PS3 for that price, I can understand his standing point.

Not that I agree with him. Can't wait for the 30th to pick up my ZombiU pack

rjejr

#29

rjejr said:

Comparing the price of the PS3 to the WiiU based on the PS3s 7 year age doesn't make a lot of sense. Comparing the price of a new Kia or Hyundia to a 7 year old Mercedes doesn't make much sense either. Just b/c it's old doesn't make it bad or less expensive.

Selling it at a loss isn't saying a whole lot to me. Is it a $3 rounding issue or $150 discount?

The Gamepad isn't adding $100 to the WiiU price. The Wii comes with a Wiimote and nunchcuck - $60 retail, the PS3 comes with a DS3, $55 retail, the WiiU comes with a Gamepad - even at $100 retail it's still only $40 extra over any other system, NOT $100 extra. Find me a system that doesn't come with any controller and then we can talk about the $100 Gamepad making the WiiU cost so much.

bahooney

#30

bahooney said:

@SkywardLink98 Yes, but the PS3 doesn't have an innovative, never been done before controller. Imagine how much manufacturing those things must cost! Plus, I heard some weird rumor about PS3's smelling like cabbage or something.

Splat

#31

Splat said:

That innovative controller is a big reason I don't have much interest in the Wii U.

Wonder_Ideal

#32

Wonder_Ideal said:

That has got to be a hit in the wallet to sell it for at a loss. But $350 isn't that bad of a price, which is why I'm still getting it.

ReindeerDasher

#34

ReindeerDasher said:

I thought I heard the Wii U needed to be $200 to sell, $300 to get a profit. Well it's selling well(for not even being out yet) but apperantly that information was wrong.

russellohh

#35

russellohh said:

@hydeks Nintendo might not have the snazzy graphics of a PS3, but I'd hardly call them 7 years behind everyone. The Wii outsold the PS3 3 to 1, and the DS outsold the Vita about 6,000 to 1. Having actually played the Wii U at various demonstrations and product shows, I have to say... it makes my 360 feel like a piece of antiquated crap.

Blue-Thunder

#37

Blue-Thunder said:

Well if you believe this baloney you'll believe anything. Nintendo are trying to make you feel like your getting a bargain, I'm not buying this bull.

ultraraichu

#38

ultraraichu said:

I'm not too surprised that the Wii U is selling at a lost. With all that modern day technology behind it, I could only come up with 3 answer how they can make a reasonable profit.
1) Like the 3ds after August, it's selling at a lost.
2) They are so advance in there technology,that they can sell at a cheaper price like how a 4 GB SD Card used to cost $30 but now less then $8. I forgot the rule/ law for this.
3) They are crazy risk takers that loves to win at russian roulette.

One way or the next I fell a bit better paying 381.05 (price + tax) compare to $150 more. Even though someone has to pay for it.

The_Fox

#40

The_Fox said:

It's gotta be the controller that's forcing them to sell it at a loss. I imagine within a year or they'll probably be selling it at cost or for a slight profit.

Geonjaha

#41

Geonjaha said:

Wait wait wait. Nintendo specifically said that they wouldnt be selling the Wii U at a loss before as far as I can remember. I thought they said the 3DS was a one off in that respect?

Jahir

#42

Jahir said:

Sad to hear it but here in Mexico the deluxe version will cost like 560 dlls. I think it's even sadder :(

Ryno

#43

Ryno said:

Those of us in the U.S. paying $299/349 are lucky. That is fine if you don't like the price point but if you want new tech you better be willing to pay for it..

LittleKing

#44

LittleKing said:

@SkywardLink98 When the Wii came out, I bet you ranted about how overpriced it was since you could buy a PS2/XBOX at that time for much cheaper. I guess you'll complain about how overpriced Sony and Microsoft's new consoles will be as well, since you can get a Wii on a good day for $100, and they'll probably cost three to six times more than that. This is a new console, and must be compared to other new consoles.

Yes, you can get a PS3 for a little cheaper than a Wii U, but when it launched, it cost twice as much as a Wii U, and that was six/seven years ago. XBOX 360 launched at the same price as the Wii U is launching now. You're telling me, you want an HD console with a controller containing motion sensors, a touchscreen, a camera, a microphone, and more, for less than $299.99? If I were working at Nintendo on the Wii U hardware team, I'd be pulling my hair out at these comments.

I can understand someone in the UK (and some other places) complaining about pricing since they always seem to get the finger, but in USA/Canada consoles tend to come out at relatively fair prices. But, yeah, you're right, it's overpriced; let's just get the Chinese guys and gals slaving away in the factories to make our Wii U's work 24 hours a day to drive the costs down, so that Nintendo's NEGATIVE profit won't go down.

"...we selected [a price] that consumers would consider to be reasonable."

Apparently Iwata was wrong, since many consumers expected it to be $200 or some crap. The console is probably expensive to produce, and they'd like to start making a (god forbid) profit later on.

iphys

#45

iphys said:

If brands meant nothing, I'd be awfully tempted to go with a PS3 instead, so I think price-conscious consumers may upgrade from the Wii to the PS3. I don't care about the GamePad or TVii, and the PS3 is cheaper and comes with a legitimate Blu-ray player. It actually looks like Sony felt comfortable raising the price for the super slim from the slim, because of the higher price of the Wii U. I think the actual consoles are similar in capability, never mind the release years, so bashing the PS3 for being last gen isn't exactly fair when Nintendo is basically a generation behind in technology.

LittleKing

#46

LittleKing said:

@iphys I have a PS3, and it is awesome. However, a core super-slim PS3 unit will cost around $250. The Wii U uses more modern technology, and has a controller with a touch screen and camera on it. Add fifty bucks for that, and you've got your standard Wii U. In the end, the pricing is almost identical; you're just paying fifty bucks more for newer tech. Fifty. Bucks.

This means, in the end, you're just comparing game libraries. Not exactly fair to do to a brand new console with no game's out, and pointless, since you could do that with any console at launch. How exactly would Nintendo manage to sell the Wii U for cheaper than a PS3?

Ryno

#47

Ryno said:

So people are actually saying the Wii U is the same as the PS3 even though at its launch the Wii U can produce the same games the PS3 took 5-6 years to do in addition to streaming to a tablet with minimal latency? Really people? Are you so mad at the price that you are trying to justifying the fact you are not getting one?

SCAR392

#48

SCAR392 said:

I'm surprised that they're doing this. Well, I honestly expected it to cost $400 or $450, but the lower price point is very nice. I don't agree with it being on terms with a PS3, because that systems old already, and I'm sure even the most recent slimmed down version still has alot of the same glitches as the older models. There's lag in the system all the time, and the internet messes up pretty frequently. It doesn't have an awesome controller like the Wii U, the graphics WILL be worse on PS3(for sure, just don't know by how much yet), Nintendo games in HD and surround sound, $250 w/o tax more for the Vita route, Move is failing(to me), and there's a ton more features on Wii U.

Link-Hero

#51

Link-Hero said:

@SkywardLink98
@hydeks

You two clearly don't get how technology works. The price of the system is NOT based on the games, but the HARDWARE.

The Wii U is capable having games that look better then most 360/PS3 games with minimal effort while being displayed on TWO screens SIMULTANEOUSLY. You call that "the same as the PS3"?

Sure, the PS3 has more games, but it's been out for about 7 years while the Wii U still hasn't even been released yet. Of course it has more games.

The logic in some people. >_>

JavierYHL

#52

JavierYHL said:

Ninty have to sell cheaper,their systems lifespan always last shorter than Sony systems so it will even out for us

AlexFirth91

#53

AlexFirth91 said:

Damn well I was just able to pre-order a deluxe at wal-mart online and it will be arriving around Nov. 29th I'm so excited!

JayMiller1988

#56

JayMiller1988 said:

I might as well put my $.02 in.

I think comparing the two generations (PS3/Xbox 360 and Wii U) is silly.

And I do think 300+ dollars for any system is expensive. I have other things to think about buying, however small an impact they may have on my pocketbook, they add up in the end- and adding 300 dollars to that figure is not what I want.

As for PS4/Xbox 720, yes, they'll be more powerful than the Wii U, and cost more, but we have to compare the numbers of 1.5x stronger to 3x stronger (I've heard higher, but let's just say 3x stronger). It's the same thing most of the other people are saying, we can get a 1.5x less strong last generation system for a better price- we never said it was comparing apples to apples, which is why I said it was silly.

BlatantlyHeroic

#57

BlatantlyHeroic said:

The PS3 was quite expensive when it was first released, and the Wii U is a next generation console, making your argument invalid, also, at the launch of the PS3, most games were around $50-$60.

grimbldoo

#59

grimbldoo said:

I honestly don't see how people think it's too expensive. You may not be able to pull out that amount of cash at the moment, I'm not, but it's not too expensive.

Gamesake

#60

Gamesake said:

It's the PS3 that's too expensive. After 6 years, Sony needs to do better than $300 in order to sell me their Blu-ray player.

@kkslider5552000 I have a hard time believing Sony too. I imagine they figure the 10 year console rigamarole will help snag a few last minutes sales before they launch their PS4. $300 for a PS3 in 2012 is nothing to get excited about.

sinalefa

#61

sinalefa said:

If you think it is too expensive, then go and get a PS360. If you care about Nintendo's franchises, you will be getting a Wii U, so do so when the price goes down or try buying used. That may take quite a while, though.

And if you don't care about Nintendo's franchises, then enjoy your PS360.

If this is overpriced, then all new systems are overpriced. Vita launched for these two price tags months ago, and that is basically a portable PS3. Wii U seems to be more powerful than that and also offer new experiences.

shonenjump86

#62

shonenjump86 said:

I don't think it's overprice, seems reasonable. I just don't really want a Wii U. Not really looking forward to it at the moment.

GreenDream

#63

GreenDream said:

I'm impressed, usually it's Sony who sells their consoles at a significant loss at launch. This is rather unusual for Nintendo. Looks like they learned a valuable lesson from the 3DS launch.

Hokori

#64

Hokori said:

@hydeks I'd rather play Nintendo published games, the only games for PS3 I'd want is MGS4, RE5 and 6 that arnt currently on wiiu
Also I'd compare the library of the wii (1s party) to the PS3s in order to have a "fighting" argument, seriously comparing a launch system with a system that's been out for 7 years, ok I'll remember this when the PS4 comes out and compare the PS4 launch titles with the WiiUs at that time current library :P

Lalivero

#65

Lalivero said:

@JayMiller1988 The thing is though, you shouldn't really be comparing a gaming console with necessities in that sense either(it appears you are referring more to necessities there, the way you worded things). A gaming console, like other fun tech things, is just that...a luxury; you don't need it.

Yes it may seem expensive if you make a general comparison with everything but, for what all it can do(we won't even be fully sure of that until it's out a while) and on top of that being a brand new luxury...you have to admit it's pretty cheap.

Btw, I'm pretty sure the others were either joking or were talking about the prices in general, not taking into account the huge time difference and tech of the times.

MAB

#66

MAB said:

Yeah and one last thing to remember kiddies when buying a PS360 this late in their life, do so at your own risk because Sony are trying to grab onto that casual market from now on. Just letting ya know in case you all forgot ;)

Tony3DS

#67

Tony3DS said:

Expensive is such a relative term. This is more than my new car payment, but I have 60 of those to look forward to and only one of these (plus maybe one more for games per year). I’ll wait for a lot of games to go on sale or just buy great eshop games in lieu of. The eshop and VC has greatly reduced my retail spending. Also I have a backlog of Metroid Other M & Kirby’s Epic Yarn that I purchased for $5 each last year, and Zelda Skyward Sword for $29. I suppose I’ll have Nintendoland as my only Wii U game for a while.

Nintenjoe64

#70

Nintenjoe64 said:

Nintendo have already absorbed a huge chunk of the losses into last year's figures so the loss they make wont kill them unless they cant sell the ones they've made.

I'm glad to hear this because that extra juice will help it compete in the new gen.

I would love it if the next Xbox and PS struggled to outperform the little U

TomThumb

#71

TomThumb said:

They must have a lot of faith in the product. I think it's at a decent price point.

Moshugan

#72

Moshugan said:

This will ofcourse fuel wild rumors that it's sold at a loss because it is after all a powerhouse machine!

WolfRamHeart

#73

WolfRamHeart said:

At first I considered the Wii U too expensive but then I remembered that I paid $500 for my PS3 and $400 for my Xbox 360. Compared to that and the fact that it is a new console which has a few games that I am interested in I think that the price is acceptable. I don't even want to think about how expensive the Xbox 720 and PS4 are going to be because I know they aren't going to be cheap.

Sir_Deadly

#74

Sir_Deadly said:

The people who are saying its too expensive, will probably just be stuck with 7th gen console. Good luck getting new great games! As for the price, its very reasonable considering the PS3 debut at $600. Cant compare 6 year old console to something thats not out yet. Sorry your argument is invalid! The people buying a Wii U will be having a great time on our next gen console. We'll be waving back at you while you'll be looking forward!

TimboBaggins

#75

TimboBaggins said:

I don't understand the people saying it costs too much. The original Wii cost $250 at launch. A stripped down Wii U will cost $300. Thats only a $50 increase. That isn't that much. That $50 is probably the controller, so what's the problem?

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