Nintendo Announces Total Operating Loss of $456 Million, Sales Largely Lower than Expected
Today, video game company Nintendo announced a total operating loss of $456 million for the fiscal year that ended on March 31, 2014, marking the third consecutive year in which the company announced an annual overall loss on operating the company. The company also, as part of its annual report as a public entity, revealed a whole slew of additional sales statistics.
Financials aren’t always the simplest to digest, and in the past few years, Nintendo’s haven’t been any easier to swallow. So let’s break this report down as clearly as we can, split into easy-to-read sections.
Total Worldwide Sales
Actual: $5.6 billion
Prediction (Early): $9 billion
Prediction (Revised): $5.79 billion
Actual: $227.9 million
Prediction: $245.4 million
Total Operating Costs
Actual: $456 million
Prediction: $335 million
Wii U Consoles Sold: 2.72 million (2.8 million predicted)
3DS Handhelds Sold: 12.24 million (13.5 million predicted)
Note: Nintendo promised investors it would move 18 million handhelds by now.
Wii U Games Sold: 18.9 million (19 million predicted for this year, 38 million originally)
3DS Games Sold: 67.9 million (66 million predicted)
Goals for New Fiscal Year
Wii U Console Sales: 3.6 million globally
Wii U Game Sales: 20 million
3DS Handheld Sales: 12 million
3DS Game Sales: 6 million
What Does it Mean?
It’s hard to say, in some ways. Nintendo has long been a strong pillar of the video game industry, even with its ups and downs. Right now, the company is struggling to find market traction and consumer interest in the Wii U, even though things are (relatively) looking up for the 3DS and its lineup. Just two console generations back, the company was in third place in the console race with the GameCube. Years before that, the company’s Virtual Boy project sank like a bowling ball in a swimming pool. It’s recovered from those instances, but only because of its immense success in other instances — the cultural phenomenon that was the Wii, the smashing success of the company in the 8 and 16-bit era, and, in some cases, its willingness to experiment.
But Nintendo has not been one, largely, to deviate from its ways. The company has been under a strong and long leadership for some time, but with financials sinking the way they are, Nintendo may be looking for a change of guard. Hopefully though, the company will continue forward with new operating models and efforts, such as using Nintendo Direct videos to talk directly to the consumer. More importantly, the company could benefit well from letting companies outside of Nintendo, once again, take a shot at their first-party properties: Zelda, Metroid, Star Fox, Kirby — and in some cases they are. They also could benefit from letting tried and true talent create all-new projects.
At this point, Nintendo is hurting significantly. Are they over? Sunk? Done for? Bitten the bullet bill? Not quite yet. The company still sits atop a mountain of cash (a degenerating mountain of cash, but a mountain of cash no less) with which it can try new things — like skip having a pricey, hyped up E3 press conference.
So… will things work out for one of the most notable companies in gaming?
There’s no telling. But I think it’s fair to assume that Nintendo’s aware of the challenges they face and the criticism they receive, so I wouldn’t count them out just yet.
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