Nintendo Sees Stock Fall By 9% After Cutting Its 20 Million Switch Sales Target

There’s a really good chance Nintendo was waiting for this stock hit before releasing a Direct and new info to boost it back up. They’ve gotten quite a bit of bad news out of the way as well in regards to delays. Hopefully they strike now to boost it back up.

That sucks, but at least they aren't Activision/EA/Bethesda/Ubisoft, who are taking much bigger hits.

Up and down, up and down, up and down

Let's just play games.

Nintendo's stock has gone down for awhile though, so not very shocking

The Switch is now about 2 years old. it has a lot of software, and I expect an updated version of the hardware coming out sometime in the next year. They didn't have as many big titles last year as they did with their launch year, which might cause for the decline.

That said, there is still a lot to look forward to. Fire Emblem and Metroid 4 (even delayed), plus all the indie and third party stuff like Wargroove and Darksiders, not to mention mobile games like Dr. Mario and Mario Kart. I'm not really concerned. A direct with their yearly lineup will get them back on track.

That's how mafia works

Investors and stock brokers are just manipulators. They are rarely ever happy.

Switch sales target lowered by 3m x $300 is $900m, almost a total $1B less revenue, but also MK Tour delayed until summer, MP delayed maybe 2 to 3 years, many of their 2019 games are still undated despite the fact we currently ARE in 2019 so they should at least have a Q or a season, but they don't.

Yoshi's Crafted World - 29th March, 2019
Fire Emblem: Three Houses - Spring 2019
Pokémon RPG for Nintendo Switch - Late 2019
Animal Crossing for Nintendo Switch - 2019
Luigi's Mansion 3 - 2019
DAEMON X MACHINA - 2019
Dragon Quest Builders 2 - 2019
Marvel Ultimate Alliance 3: The Black Order - 2019
Bayonetta 3 - TBA
Metroid Prime 4 - TBA

Was there really any reason for the stock to go up?

I feel like Nintendo is really the only company that is routinely and unfairly punished in the stock market, mostly from investors who know absolutely NOTHING about the company or the video game industry as a whole. The stock market is a complete and utter joke.

I don’t know why they don’t aim lower every time and exceed their expectations. That always looks better.

Despite what fans say, they dropped the ball this second year. They came out swinging with big titles, and then didn't do much to carry that momentum.

Sure. You people might like Kirby, Labo and Mario Tennis but they aren't Zelda and Mario.

@Tsurii

It does actually, but thanks for playing.

@rjejr i agree, also their tendency to keep all information secret until close to reveil is hurting them in this sense. People can only make a decision bases on information they have and the (new) information thus far is not really worth while.

Typical results. It'll bounce back, but this is just what happens if you miss your sales target, even if it wasn't by much.

@rjejr Well, there is the fact that this was their best year financially since the best of the Wii years in 2009. Or there's the fact that the Switch is outselling even the PS4 launch aligned. Or there's the fact that all mobile games in total are about 1% of Nintendo's revenue, so that delay will likely mean little in terms of short term income, since those games are more about brand recognition. Plus they revealed they have multiple unrevealed games for FY 2019 during the presentation, including a particularly heavy hitter, and another that will significantly boost NSO attachment supposedly.

I'm not saying it should've gone up necessarily, but a 10% drop was a huge overreaction.

Share prices can go down as well as up.

Direct next week. Let's get this year moving!

They’re still making video games, right? They are? Cool, I’m good then.

Same as Nvidia who will miss by half a billion and tanked 15%

https://www.guru3d.com/news-story/nvidia-drops-q4-revenue-expectation-by-5b,5.html

If you over promise you will get punished. How it works.

2019 is the Switch break out year - hopefully. Just release big games.

Regardless of Nintendo's terrific holiday season, the stock market proves to always be a sickening sight to behold. Never change, brokers. Never change.

I knew they wouldn't reach 20 million with only a wii u port releasing before march.

@rjejr Exactly!

I had release dates for KH3, Division2, ANthem, Metro Exodus, DevilMayCry5, Dirt 2.0, Sekiro, Rage 2.

I've seen videos, behind the scenes, play test... ANTHEM has a demo out today!

The Switch release schedule for big games is a void. We do not even know when the Direct date is - to know when the game date is 🙃

I won't deny it would be nice to know when exactly Pokemon or Animal Crossing (just using those as examples) is coming. However, not knowing isn't exactly the end of the world. Barring complete botching in their development or my finances going into dire straits before they're released, I am locked in to those games. And for me personally if I'm genuinely into a game, I have no problem waiting for more info.

This is normal.

maybe Nintendo should have launched more major games throughout 2018 and not just Smash and Pokemon in the last two months of the year? Software drives hardware sales.

Ultimately, this is really overblown anyway

They go up and down many many times a year, who cares? lol

What I find hilarious is that despite the 3 million unit hardware forecast reducton, Nintendo has maintained their revenue and profit forecasts.

In fact, Nintendo earned more operating profit in Q4 2018 alone than they projected for their entire 2018 fiscal year. Yet for some reason, Nintendo couldn't even be bothered to adjust their fiscal year operating profits upward.

Talk about being "conservative"...

@rjejr That's an insane way to look at sales. It's not close to a billion less revenue when you're calculating 3 million Switch units at retail pricing. It's WAY less than that. You miscalculated the figure and then you rounded up.

@ReaderRagfihs Stock values are based on success and expectation. It's a not a punishment here, it's a readjustment of the value of each stock based off what the actual performance was. This price is still higher than pre-June 2017.

@VinylCreep It's close to a billion in sales in American dollars - but since Nintendo isn't getting 100 percent of a retail sale, yeah you're right, 3 mill less Switches sold is not 1 billion less for Nintendo. BUT BUTT if you imagine of those 3 million units sold, someone would buy at least ONE or TWO games and maybe one or a couple little other things ( a case, an eshop game) it would get a lot closer to a billion in revenue lost.

Glad their stock dropped, last year was pretty much "arrogant Nintendo is back!" They are at their upmost BEST and FINEST when they got something to prove.

I’m disappointed. No one said DOOOMED.

Seems like crybaby investor drama more than rational thought. They at NCL over shot their guess again and you get this. You’d think both sides would learn especially when the real world sales figures are excellent. Had they said 15M it would be all smiles.

I find this somewhat ironic. Don't the investors realize that the Switch has outsold the 22-month sales of EVERY console released besides the original Wii? Smash Ultimate almost outsold lifetime Wii U sales in 3 1/2 weeks! Sure, they aimed a little high with their goal of Switch sales, but look at where that's landed them. Nintendo's currently printing money with the Switch and the games on it.

It's so humorous to me that stocks rise and fall based on guesses of how much a company will sell. It's about as humorous as gas prices rising and falling based on speculation of what may happen based on some current event.

Eh, Nintendo shares will jump up in price again, then down again. Such is the nature of the stock market.

I am curious as to what they'll be after the next Direct.

Same happened to Sony today, also 9%, because they missed their target of 8,7 trillion yen (they made 8,5 trillion yen and profit was higher than expected).

https://www.fool.com/investing/2019/02/01/why-sony-stock-just-dropped-9.aspx

This is why I never intend to work for a company that has shareholders that don’t know anything about the business they’re ‘investing in’ (planting their greedy hands in for a quick cashgrab).

@1UP_MARIO I've got ya covered, bud.

This is why it was smart of the new president to go ahead and slash forecasts now, get it over with. That way they'll exceed the new forecast, and as long as they make conservative estimates going forward, they'll be alright.

At the end of the day, value balances out. Any value lost from a stock selloff was inflated, unjustified speculative value in the first place, and speculative fluff kill stocks with their crazy variation up and down with every fart in the wind Nintendo makes.

Get the weak money out. Cleanse the pool of investors of the day traders looking for a quick buck.

@Agramonte news like this wouldn’t make a difference. Take a look at Sony’s stock market and you’ll see.

See they shouldn't had done that, investors are like credit reports. If you made odd changes to something that may worries the investors, expect to see dropped in your stocks just like if you made questionable decisions that worries lenders your credits will dropped as well. It may not be something to worry about at first but keep in mind that the more your stock dropped the more worries investors are likely to invest in your stocks ever again thus losing faith in your company same as credit reports, keep decreasing your credits and eventually lenders will had no faith in your report and may not offer you any loan service in the case if you want financial support.

😱 what was Furakawa thinking

Ah, to be beholden to shareholders and gambling “investors”.
Stay private, boys and girls.

Some need to read up on how stocks work. Nintendo stated a certain sales forcast to the market. If you miss that mark, your stock will drop. Saying Nintendo had a really good year or sold a ton of games is not understanding how stocks work. Nintendo isn’t being unfairly punished lol

Time to buy then.

@Strumpan - It was likely the cut suggest a couple investors to drop their investment while it remains high. The dip got bigger because others did the same. So your op is right on the money. Invest oportinity.

Stocks gunna stock.

@WaveBoy as i said a few posts before you posted your inferior ramble: Sony’s stocks dropped with 9% too; even though they had RE 2 remake.

So quit your console warmongering and let us have fun with our superior handheld!

@Friendly Same as Apple. They even had to suspend trading. And they still making 84 Billion.

https://www.businessinsider.com/apple-warns-holiday-quarter-was-a-huge-miss-2019-1

Sony's Mobile/Financial divisions are in the toilet. Does not help Nintendo that SONY reported more PS4 sales in the 2018 calendar year either. Even after a YoY decline.

https://wccftech.com/playstaion-4-top-seller-2019-switch/

PS4: 17.7 million
Switch: 17.4 million

They wanted Nintendo to hit it out of the park in 2018. Didn't happen - Take the hit - focus on 2019.

@VinylCreep "and then you rounded up."

I rounded up b/c this past holiday Nitneod was selling a lot of Switch for $359 in the Pokemon bundle and $379 in the Smash bundle so a lot of them were going for more than $300. Now I'm not sure which of those 2 bundles Nintneod fell 3 million short of selling, maybe just the $300 one, but that's still a lot of revenue lost. Not net, but gross. And then, dont' forget, for every Switch sold they are selling games. How many game sales did they expect for each of those 3 million Switch sold that they didnt? 1 game? 2? 3? At $60 each. Every lost Switch sale is at least 1 lost game sale, so that's at least 3 million lost games sales that are a part of my lost $1B figure. Unless you think a lot of people are just buying a Switch but not any games? Or extra Joycon. Or a $20 NO subscription. Or cardboard.

How much gross revenue do you figure they lost by not selling those 3 million Switch they had planned on selling?
Edit: Gross, not net, too much tying for me.

Oh, thanks for the assist @Dang69 had I seen your reply earlier my reply could have been a lot shorter.

@Agramonte "release dates"

You left out "Days Gone", April 26th. I had thought it was going to crash and burn myself, another The Last of Us zombie wannabe, but the new trailers and info seem to be favorably received. Probably be a GotY contender and sell well enough for April on those 90m PS4 once everyone is done w/ RE2 and KH3. I'm planning on playing it once it hits PS+ on PS5 myself, but thats' just me. 😉

Oh yeah, the overall point stands though, why buy a stock now for a bunch of games that may not release until Nov, Dec, 2020?

@link3710 "was"

There's a lot of past tense in your comment. Investors don't buy stocks based on past success, they buy it based on future expectations of making money. The future is a 3DS thats' fallen off a cliff, "unknown" games that could be anything, another Starfox Zero, or Animal Crossing: amiibo Festival. Or heaven forbid Wii Music. Just b/c Nintneod says they have another announced game doesn't automatically make them money. Even if most of their games are hits, some do in fact fail.

And stocks almost always fall after the news regardless - buy the rumour, sell the news - and while this news may have shown a very nice 2018 it doesn't show a robust money making 2019 by any means. It will bounce back, next week, next month, stocks bounce. I think their next big bounce will be the new hardware revision, whatever that is, or at least announce a $199 Switch Portable that parents can buy for their kids. More console sales mean more game sales as well.

Nothing they said says "buy" to me in the short term. And it's always better to buy after you think it's hit bottom.

@Drussa I've never liked their secrecy, drives me nuts in fact, Nintnedo on the mountain, spent 2 years talking about NX before telling us what it was, meanwhile Wii U died. But I've accepted the fact, true or not, that's the Japanese way. It still bothers me, but having a reason behind their insanity helps a bit. Apparently Sony is considered more of a western company now b/c they talk about stuff. And have a western President. And make western games.

Nintendo is Nintendo.

@JackEatsSparrows now the comment section feels more welcoming to everyone 😉

Good grief.... investors are annoying.
That said, nows a good time to buy some shares!

@Agramonte PS4: 17.7 million, Switch: 17.4 million

I'm still not sold on those sold numbers, (pun intended) I'm pretty sure Sony is reporting "shipped' as "sold' even though they admit there are 2.6m unsold PS4 in the world, 94m shipped vs 91m sold.

You can watch me get raked over the coals and shredded into little pieces about my opinion on the matter here.

http://www.pushsquare.com/news/2019/02/ps4_was_the_worlds_best-selling_console_in_2018

@WaveBoy I don’t think investors work like that...

Market contraction is going to be a thing in the near future for macroeconomic reasons. I wouldn't read much into assessing companies that have to operate in those conditions.

@VinylCreep "That's the danger of just making up figures like that."

"Nintendo made 9 billion dollars in the last 10 years"

Where did you get YOUR figures from?

This website says Nintnedo's NET REVENUE just for 2018 was $9.95 billion. Not the past 10 years combined, just 2018.

"In 2018, Nintendo's net sales amounted to 9.95 billion U.S. dollars"

https://www.statista.com/statistics/216622/net-sales-of-nintendo-since-2008/

And that's NET revenue. Which I have no idea how to calculate, which is why I try to stick w/ gross revenue, which is simply how much they should be making selling something. Net is after costs.

If Nintnedo made $9B selling 17m Switch that's about $1B for every 2m Switch sold, since their 3DS or mobile income was very low last year compared to Switch income. So if they are saying they made $1B for every 2m Switch sold I don't think saying $1B for the 3m Switch not sold is too far off.

And again, they are talking about NET REVENUE, I was looking at the simpler gross, money coming in from Switch sales.

Nintnedo also had $9.6B in revenue in 2017 on 15m Switch sales. 3m Switch sales equating to $1B doesn't seem unreasonable.

https://www.forbes.com/sites/mattperez/2018/04/26/nintendo-ends-its-comeback-year-with-over-9-billion-in-revenue/#42cb4b885ff0

@rjejr All numbers are "shipped not sold". If you go to the "assets" sheet in the financial. You will find "inventory"... or what they have stashed.

Nintendo has 181,839 (million of Yen) up from 141,795 3 months ago (That are not 3DSs - could be a bunch of LABOS 😉)

That also does not mean "they at a store". Every company has items "in Channel". example, Apple had 4-5m+ units there. But those are all claimed for by distributer. So they "sold"

Some have no rights on return or they have orders in the books to cover them. (They would need to take a Charge on the next quarterly if they get 2.5 million units with nowhere to go)

SONY did not lower their full "quarterly year" estimate. So orders are coming in at the pace they need.

They had already reported 5.5 Million from last 6 weeks of 2018

https://www.thesixthaxis.com/2019/01/08/the-playstation-4-passed-90-million-sales-over-christmas-and-one-in-ten-buy-marvels-spider-man/

But yes, All these numbers are up to a point a "guess" - don't you love quarterlies? - I spent years of my life designing Annual reports. They mostly BS 🙃

Sucks to be them

@WaveBoy not a fact. Opinion. Got to learn the difference, mate. What you describe as an inferior port (pixelwise or framerate or whatever), is in fact a superior port to a hybrid system. Funny that even after 1,5 years there’s still people like you (cobalt) talking the same pkiuhb over and over again.

I can’t take anyone serious who can’t even get the abbreviation of etcetera right.

This is extra-meaningless. The stock market has just reached the tail end of a rally and nearly everybody's coming down to Earth. Sony's stock dropped almost as much over this period, and as far as I know, they haven't come out with any news that would startle investors.

@rjejr The Switch hardware maths are revenue and not profit. Nintendo makes small margins on hardware and much bigger margins on Software. So the 3m down revision for Switch is more than offset by the 10m up revision on software.

I'd say 8/10 financial estimates by games companies are wrong in on area or another. Some estimates were too low, some were too high. Nintendo managed both this time around. They haven't changed their financial forecasts. All good.

Investers just doing knee jerk reactions? That's never happened before so Nintendo is Dooooommmmmeeedddd!

@MoonKnight7 They'll probably sell 18 million and look like hero's.

@SamuraiPanda I can't agree with you more. He doesn't seem like a good fit. Kimishima was a bull dog but not a "people" person like Iwata, but that guy new how to spend money to make money..he was killing it. The new dude seems like the kid in high school no one liked because he was annoying in some way...maybe I'm stereotyping his look or maybe some things he has said...he seems "green."

@ReaderRagfihs My thoughts exactly.

Did someone say 17 million? NOT IN THIS HOUSE

@rjejr this would make sense except Software totals overperformed last quarter t such a point that any loss from a lowered forecast was wiped. And they didn’t actually change any financial forecast regarding income and profit.

wouldnt matter if they cut switch sales is going to boom through out this year with big hitters and plenty of 3rd party support for it.

That's what you get for lying to the shareholders. We all know 20 million is never going to happen.

@Retupmocnin they didnt lie man it was an estimate but switch could reach this year in no time.

I'd say this is meaningless because investors are already jittery over stupid things like Brexit and Trump and Italy now in recession. So with lots of bad news elsewhere they panic at Nintendo's seemingly bad news because they don't understand it. But really with a games and console company the nature of the products is that you have to take a multiyear view because a great new game or console can take even a decade. Development times in the the serious games industry are really long, much longer than the stock market's quarterly nonsense. Really the stock market isn't fit to value the games industry accurately.

Am I they only one who is wondering where the First party games are? The Switch in year one was amazing. It fell off a cliff after that. It's been 2 years since a real Mario, Zelda, Mario Kart, and Splatoon. Where's all the games that aren't indies? Has Nintendo lost their curiosity?

LOL Nintendo!!!! Get Rekt.

@biglittlejake where have you been man this year switch has a big lineup of games coming to it have patience man.

I really hate investors for a lot of reasons totally unrelated to video games. Wall Street and the other stock markets around the world are literally core centers of the absolute worst humanity has to offer

Back on topic though, investors don't know jack about games, and as a result stocks jump up and down for game companies all the time.

@WaveBoy
"Negativity aside I dig the Switch"

@Lionyone It's not because of the US economy, the US economy is firing on all cylinders right now by every measure(probably best we've had since I can remember, and I'm old lol)....Brexit, you have the scare campaign trying to scare everyone and undermine the vote. Italy's problems have been stewing for a long time...the EU is a sinking ship unfortunately.
I think it's just a matter of missing the sales forecast like the article says, the delay of one of the biggest titles didn't help and Nintendo isn't up front about what's coming really.

@purpleibby Brexit isn't scare stories, you've been fake news. UK has lost a LOT of real money because of brexit, we're talking many many billions of pounds lost. EU isn't sinking, it's rising, it just signed massive unprecedented trade deals with Japan and Singapore. USA economy is heading downwards due to trade war with China and shutdown. The figures you're talking about precede the trade war and shutdown and were due to Obama era investments paying off. Trump hasn't invested in USA economy instead he's wasted money on tax cuts for the mega-rich and that will drag the economy down. Economists expect USA to be in recession in 2020. I don't like any of it by thems just the facts. And these are reasons why investors are jittery. In the short to medium term it's not a good time to be investing in major parts of the world. Which is why I prefer to live in the Nintendo world when I can, it's a wonderful escape and distraction from pretty harsh aspects of reality without denying reality for what it is.

@PrincessBowsette
I know good games are coming. It's just it's starting become like the Wii U. Last year only 2 good games came out(smash and a pokemon let's go). I am getting frustrated for how long it's taking Nintendo. You can only replay breath of the wild so many times. I just feel like all the games are going to come out next year or the holiday season. What are we supposed to do just play indies for 6 months?

Mega Man 11 is seriously the first thing that comes to your mind, @WaveBoy?

@biglittlejake look at april its jam packed with games for switch man and switch is not going o have any drought anytime soon.

@PrincessBowsette
Ok.

@WaveBoy
What's funny in all this is how the Switch's hybrid nature is always given an offhand mention while it's the biggest game changer here. The reason the Wii U failed, aside from... well, everything else (advertising, poor power-gap-to-price-gap ratio, the works), was that while in the then previous generation even Nintendo newbies had reasons to own both a DS and a Wii, in the Wii U era said console was... well, mostly for pre-existing fans. Most other people knew the good stuff was mostly on 3DS, thus ironically inverting the PS4/PSVita situation (where most of the efforts went to the home console instead).
None of this old dual-console scenario is happening with the Switch. Any and all third-party development efforts are going to benefit from both the handheld gaming market, where Nintendo always slaughtered the competition, and the home console market. While the most cynical people can say the Switch is just "a very powerful handheld", it also means it's a powerful console in Nintendo's historically most powerful market. Those who develop a "handheld title" for it automatically end up creating a home console game too, and vice versa.
Which is exactly the reason I had a pretty specific wishlist to share earlier today.

@Galenmereth How is it a scam? Or is it one of your silly conspiracy theories?

So investors freaked out as usual? Good I thought the apocalypse was on its way.

@Agramonte "All numbers are "shipped not sold""

I get that. I'd say I get about 75%-80% of all of that. Which I digested to - nobody knows what's been purchased so "shipped" is as good as we got.

But I still say shipped isn't "sold', as in sold to the public. Sony could probably argue they "Sold" - as in sold to stores - more PS Classics than Nintnedo "sold" NES or SNES Classics, but we know probably 80% of that PS Classic inventory is sitting in piles in stores, marked down from $99 to $25.

So yes, Sony "sold" it to stores and it's "sold" to Sony's bottom line b/c they sold it non-refundable, but nobody should be going around saying "PS Classic OUTSOLD NES + SNES Classic Combined" just b/c Sony hoodwinked a bunch of retailers.

Shipped is shipped, anyone can ship anything, sold is the interest of the public. Or at least it should be. And I'm not convinced Sony sold more units to the general public than Nintnedo did in 2018 based on shipped numbers. I'd settle for "Too Close to Call" but certainly nobody should be bragging about it based on what we know.

@rjejr
I agree.
Though I love my Switch, the truth is, there's very little first party content that has interested me since launch, let alone during 2018.
I absolutely loved zelda, however, I could play that on my Wii U, so I hesitate to count that.
Mario Odyssey was the last first party title I've played, and it was the most recent to have interested me enough to buy it.
I've played a bunch of third party titles but nothing I couldn't play on my Xbox or a ps4 should I choose to buy one.
Nintendo makes damn fine games, I doubt anyone would argue with that, however, this has definitely not been a stellar year.
The only core nintendo published titles were Kirby, Pokemon Let's Go, and Smash.
Not really a fan of fighting games, Kirby is awesome but I've got a backlog of 2D platformers, and Pokemon Let's Go doesn't appeal to me in the same way a core Pokemon rpg would.
2019 doesn't appear to be any better until late in the year.
Though a delay to make Metroid a better game is a good thing, that doesn't absolve them from not having any core, first party, action or adventure games, which are what I buy consoles for, and I assume many others as well.

@WaveBoy
So what? You still have a great home console that not only can play your games anywhere, but can also be plugged in any HDTV far more easily than any other current console (mini retro ones notwithstanding).
It can all be chalked up to different viewpoints, really. I could easily see the next Xbox and PS5 being hybrid systems. However, on the other hand, VR is not as much of a game changer; if anything, it emphasizes how much you're chained to your home, rather than freedom to play anywhere, you're "trapped", so to speak. Which, of course, is specifically how I see it.
I've had quite a few problems in the past, especially with my folks at home, with gaming being demonized as something that kept my mind trapped in it, and it was actually the case in my younger years (it didn't help that it did feel like some kind of substance dependence) as I hadn't figured out yet how to manage my time pushing buttons. The 3DS was as much "gaming feeling real" as I was willing to handle; the TV screen "barrier" will quite never feel detrimental to my enjoyment of a game.
And I'm glad the Switch got us rid of the sentence "want to try this game I bought? Gotta go to my place then", as that option is not always 100% viable.

@rjejr yeah, they more into proving they made money than bragging. Ours or the srores 😂

Safe to say they both sold well.

@Dringo "is more than offset"

I can't imagine there's an analyst alive who looks at one area being good offsetting the other one being bad. The good one is good, but the bad one is still bad, and usually all they need is a whiff of bad news anywhere to write a stock off.

So while I agree with you they might not have lost that much profit on not selling 3 million consoles b/c they make little profit from hardware, if they made the 3 million consoles they've ALREADY laid out the money to make them, so they are OUT that money until those 3 million are sold. I don't know if they've made them yet or not, it's probably in there somewhere, somebody already replied to me about inventory #s, might have even been you, but 3m short is still 3m short, and it's still 15% short. That's not 1% or 2%, it's not a rounding error, it's 15%, that's about 1/6 less than they said.

Money was less on their hardware prediction regardless of how much more they made on their software prediction. And I think that's how these analysts saw it, hence the 9% stock drop. IF analysts only cared about the software side, or they saw it as a wash, then the stock would have gone up, no?

@SCAssassin "this would make sense except"

Ah man, I just answered that in another reply. see #105 above.

tl;dr While I may agree with you, the stock dropped 9%, so the analysts apparently didn't see it your way, they focused on the 3m hardware shortfall. So even if there revenue forecasts remain the same, analysts probably expected a jump based on another 3m Switch sold. Analysts seem to like when companies under promise and over deliver, not the other way around.

@Ig88slayer Yeah, I think analysts look more at "what is coming out that will sell really well and sell hardware" realistically then Nitneod saying "We have over 1,500 games on the eShop" that aren't really big sellers. I still can't believe "Eggggg The Puking Platformer" is a real game.

@rjejr They haven’t laid out the money to make them because that is a shipped figure in the first place. It’s an estimate that they’ll revise and alter over the course of the year.

Yes, 3m is not an insignificant number. But nor is 10m. And that’s my point. And that does offset things. And analysts do say that offsets things, because as an analyst myself... it offsets things.

If you planned to sell 5m of one game and 5m of another, and it ends up 4m and 6m... sure, one didn’t do as expected and the other exceeded. But the result to the profit and therefore health of the business? 0. The fact that Nintendo can sell 3m fewer machines and still sell more software than expected is frankly remarkable. In fact, it highlights a high level engagement with the install base. Which is really promising.

Regardless, I’m not disagreeing that missing a target by 3m isn’t going to disappoint shareholders (notoriously nervous around Nintendo... although Nintendo is up 5% today). But that 10m software improvement is such a big deal. It suggests the user base is truly engaged in buying content, and the margins on software are so much higher.

Overall conclusion of Nintendo’s financials:

Strong digital performance, very robust software sales, clear platform momentum coming out of Christmas, hardware sales earlier in the FY quite low, efforts to widen install base with Labo unsuccessful, mobile margins are good but not delivering as expected, ok start for Nintendo Switch Online, licensing business promising.

@rjejr Shareholders. Analysts actually question why the stock went down that low despite promising results.

@Dringo "Overall conclusion of Nintendo’s financials:"

So as an analyst yourself, which is nice to know - I'm a sociologist, we don't do numbers, we do people, all of whom are currently completely insane - do you think analysts think that 3m shortfall means Nitneod should drop hardware and go 3rd party like Sega? I know that was all the rage while the Wii U withered and died on the vine, but the 33m Switch sales should have changed their mind, but I'm wondering if that 3m shortfall has them rethinking the idea, hence the stock shortfall.

Something caused a 9% fall, guess I'm determined to find it. Though the 5% up today puts it at a 4% drop, which had that been the drop last week I really wouldn't have cared, 4% isn't too bad. 9% seemed like a lot.

@SCAssassin "Shareholders. Analysts actually question why the stock went down that low despite promising results."

Thanks for the clarification. I guess if the stock dropped 9% and analysts wondered why so much that might help explain today's 5% pop, so at least I can make sense of something.

@rjejr @rjejr There is no need for Nintendo to do anything significant, except release games. They have a popular platform that has a highly engaged audience. And the profit figures speak for itself.

Share price is really just an indicator of shareholder confidence in a company. It doesn’t really mean anything practical. It doesn’t impact Nintendo’s bottom line. It’s just sometimes shareholders are not sure how Nintendo is going to perform - and that’s fair enough. Nintendo clearly don’t half the time.

It’s key to remember two things. The first is that Nintendo is built as a hardware business. From its software teams to its hardware division, they’re built for making consoles. Some of their games are not hugely commercially viable, but they make them anyway because it brings gamers to the hardware, who then buy other games. Third party publishers don’t do that. They have to make considerable margin on each title. So to ‘go third-party’ is not like flicking a switch. They have to change the games they make, the frequency of them and lay off a lot of people. It’s a fundamental business change.

And secondly, only 2 companies have done that before. The first, Atari, is limping on but is a shadow of itself. Sega effectively died and was reborn a PC publisher making wildly different games. ‘Going third party’ is, I’d argue, a far more dangerous route to go than people realise.

@Dringo "more dangerous route to go than people realise"

Than people may realize maybe, but if you were around these parts during the 4 torturous Wii U years then you'd know there were a lot of calls by investors and analysts to go 3rd party. And w/ Super Mario Run, Animal Crossing: Pocket Camp, FE Heroes, and Mario Kart Tour coming, some might say that move has already begun.

W/ Switch doing so well nobody is going to tell Nintendo to drop hardware now, but if Nintendo switches gears for whatever comes after, like a lunchbox lookalike Gamecube, opinion may shift the other way.

And in another 5 or 10 years all gaming companies may be 3rd party as Google, Apple, Amazon, whoever make all the hardware for all the games to play on. Though I'm not looking forward to that, I'll just stop gaming at that point. But it might be the future.

@rjejr Oh I’m familiar of what some analysts say about Nintendo. But it’s usually the ones who don’t spend much time in games.

Nintendo see themselves as a toy company. That’s what they make, big digital toys with cool functionality. Even if they did move from physical platforms to digital platforms (which is a big leap from where they are currently), I don’t think they’d go third-party in the traditional sense.

Smartphone move is primarily to grow revenues, and promote their brands to a wider audience. It’s not profitable enough, consistent enough or reliable enough to build a business around. Especially a business as big as Nintendo.

And they are big. They were the No.1 publisher of games software over Christmas and either No.1 or No.2 games hardware manufacturer depending on the market. They’re among the biggest games companies in the world. It’s sometimes easy to forget that

@Dringo "Smartphone move is primarily to grow revenues, and promote their brands to a wider audience. It’s not profitable enough, consistent enough or reliable enough to build a business around. Especially a business as big as Nintendo."

Man, we could have used some more level headed comments like that around here years ago. And not years ago when the DeNa deal was announced alongside NX and people were freaking out all over the place, but years before that, when Iwata was saying "Nintendo will cease to be Nintnedo if we put a game on the mobile platform" and every body would swear if any Nintneod game ever showed up on mobile they'd stop buying all Nintnedo games and hardware. It was nuts. Kind of like the whole world is now come to think about it.

You already know this I'm sure but I like to be thorough when I "" people who have passed away so I dont' get accused of attacking the defenseless.

https://gamerant.com/nintendo-profits-problems-mobile-market/

https://gamerant.com/satoru-iwata-nintendo-mobile/