Published in Games

Nintendo takes a plunge

nintendo grey

Posts first operating loss ever

It appears
as if Nintendo’s Wii magic has worn off and the company’s horses turned into pumpkins as the company posted its first ever operating loss.

The loss lists a deficit of about $458 million for the now past business year. On a slightly lighter note, if there is one, the loss is still better than the consensus forecast, which was slightly under $512 million.

While it enjoyed a fair share of success as of late, the company’s most recent plans on Wii and 3DS sales didn’t go quite well. Strong yen didn't help either while analysts also point at smartphone and tablet markets slowly chewing away at Nintendo’s. mobile gaming share

Nintendo’s CEO Satoru Iwata conceded that he isn’t satisfied with the past year and added that EU sales of 3DS haven’t been as good as in Japan. He added that strong yen is also to blame but refused to offer more information on Nintendo’s possible reaction. However, the company expects operating profit of around $430 million, whereas consensus estimate is in the vicinity of $500 million.

Although Nintendo has ruled the mobile gaming segment for quite a while, smartphones are slowly but surely pushing it out, as recent surveys on mobile gaming habits confirm. Since it’s pretty clear by now that Wii U isn’t quite going to revolutionize the market either, it is time for Nintendo to take a step back and think long and hard about the future.

More here.

Last modified on 26 April 2012
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