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Nintendo reports net loss of $324 million

Nintendo launched the 3DS last March and announced the Wii U in June, but neither device prevented the company from reporting a $324 million loss during the first fiscal quarter of this year (Apr 1 to Jun 30). Nintendo cites poor sales of both the 3DS and Wii titles as the reason for the deficit, cutting its full-year profit forecast by 82 percent to $257 million from its previous estimate of $1.41 billion.

Despite selling 400,000 units on launch day, Nintendo 3DS sales have dropped sharply. Nintendo expected global sales to reach 4 million units in the first month, but as of March 31 only 3.61 million 3DS handhelds had been sold. In the last three months sales remained slow, with only an additional 710,000 units sold.

That brings the total 3DS sales to 4.32 million (830,000 in the US total), breaking the 4 million milestone. Still, the slow sales are no doubt a disappointment for the company as the achievement comes three months later than expected.

Speaking at a recent shareholders meeting, Nintendo President Satoru Iwata blamed sluggish 3DS sales on the system’s launch lineup, saying “we were not able to launch Nintendo 3DS at a time when a sufficient number of strong software titles were ready.”



New titles are incoming, but they're still several months away. Kid Icarus: Uprising which could release around the holidays, Super Mario Land 3D is expected in November, and Mario Kart 7 is expected in December. Until the holidays, drumming up interest in the 3DS may prove difficult since this summer's two most notable releases, Ocarina of Time and Star Fox 64, are both Nintendo 64 remakes rather than new franchise entries or titles.

Unfortunately, the lack of consumer response to the 3DS hasn't encouraged new games to arrive sooner, but has instead led — at least in part — to the cancelation of Mega Man Legends 3, the delay of games like Shinobi and Crush3D, and two weeks without any virtual console updates.

President Iwata did promise that Nintendo wouldn't be making the same mistake with the Wii U, saying that "we are considering details, such as what software is suitable for the launch, more carefully than ever before."

Without any big releases for the 3DS to boost sales, Nintendo has resorted to dramatic price cut for the new handheld. To make up for the price difference, early adopters of the 3DS will be offered 10 free NES Virtual Console games and 10 free picks form the Game Boy Advance Virtual Console to anyone who purchases a 3DS before August 12. The NES games will be made available September 1 and GBA games should be available before the end of the year.

Jul 28, 2011

Source: Nintendo Financial ReportDailyTech 

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14 comments

  • GamesRadarPaulRyan - July 29, 2011 2:28 p.m.

    I think you guys are getting it right: you can't sell a console without any games, and it's still going to be a few months before Nintendo gets games out that I'd have liked to see at launch. On another note, I've heard Iwata has said that Nintendo is now willing to take a much more supportive role in investing in third-party developers for the 3DS, which is great, but probably related to the company not having as much cash to invest in their own properties as it thought it would.
  • Thequestion 121 - July 29, 2011 5:06 a.m.

    Oh man, Nintendo is feeling the pressure.
  • IcePotato - July 29, 2011 1:34 a.m.

    Release some good games, i'd be happy to buy them. The newest Wii game i own is NMH2.
  • Defguru7777 - July 29, 2011 1:33 a.m.

    Well, the Wii software is in a transitional period since the Wii U is coming out next year, so that's not surprising. And we all knew the 3DS wasn't selling well, so no surprise there. Still, it's depressing news. Hopefully Nintendo will use this situation to make itself stronger with better games and hardware.
  • falcon4196 - July 29, 2011 12:05 a.m.

    If Nintendo is going to launch a new system they need to have Mario and Zelda games lined up as launched titles. You gotta bring out the big guns early.
  • etherealshadow - July 28, 2011 11:13 p.m.

    Well, when you alienate your original fanbase so that you can appeal to the always fickle masses, you may do well at first, but it'll bite you in the arse as soon as the next big thing comes out for the masses to fawn over. Right now that new thing is smartphones and cheap apps like angry birds. Nintendo knows they need to reach out to their core again, as shown by their last E3 presentation, but you can't expect your ex to take you back willingly after you left them for someone else for the last 10 or so years.
  • MonocledYaoGuai - July 28, 2011 11:10 p.m.

    This is depressing, but seriously, get it together Nintendo. You shouldn't be surprised a GAME system isn't selling without any GAMES.
  • Cyberninja - July 28, 2011 10:53 p.m.

    after the earthquake in japan i am not surprised this happened because alot of people who would have bought it would have no money and the games are there just not alot of good ones about 10 which isnt bad for a 4 month old handheld.
  • KippDynamite - July 28, 2011 10:51 p.m.

    "cutting its full-year profit forecast by 82 percent to $257 million from its previous estimate of $1.41 billion." That is crazy. Since they are able to lop off so much of the price, I wonder if they could have launched it for that price in the first place.
  • DirkSteele1 - July 28, 2011 10:43 p.m.

    I was sitting at my desk this morning preparing for another day of trading when the Nintendo profit warning headline flashed across my Bloomberg Terminal. It looked even more impressive as was in Japanese Yen so profit forecast was cut from 110 billion yen to 20 billion yen. I really do believe we may be watching the beginning of Nintendo's evolution from platform maker to 3rd party software producer. Sega Version 2.0.
  • codystovall - July 28, 2011 10:43 p.m.

    Is it wrong that this makes me happy seeing how i suffered a net loss when purchasing a wii.
  • HankVenture - July 28, 2011 10:42 p.m.

    how were you unable to launch YOUR system later? and why did you think it would sell well when you didn't have anything for it? Gotta say nintendo, you have to get your head out of your own fanboy ass, you have become a joke amongst the gaming community, you arent idealized anymore so people aren't going to just JUMP at your new hardware. PS give me my free games now please..Mainly Metroid fusion
  • jackthemenace - July 28, 2011 10:38 p.m.

    “we were not able to launch Nintendo 3DS at a time when a sufficient number of strong software titles were ready.” Wrong. You were not able to launch it at a time when anyone had the money to pay a couple hundred pounds for a console they already own with a novelty gimmick tacked on.
  • ruskii - July 28, 2011 10:35 p.m.

    The good news is, I was waiting for the price to drop on the 3DS before even considering buying it... I'm just surprised the drop happened so soon :(

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