Update – Nintendo posts first annual loss, BUT expects 3DS profit by September
First, the some-what bad news: Nintendo posted its financial report for the first fiscal year ending March 31, which resulted in a 36 percent drop in revenue for the company. In total, Nintendo lost 37.3 billion yen ($458 million). The reason for the loss though can attributed to the increase of more Nintendo 3DS’ being moved. Despite a hugely successful price drop last August, Nintendo still continues to lose a profit on each 3DS sold.
Now, the good news: Satoru Iwata recently told investors that Nintendo expects move 18.5 million 3DS units by the end of this year. By comparison, 13.35 million 3DS units were sold last financial year.
Below is Mr. Iwata’s quote regarding making a profit off the 3DS:
“For the Nintendo 3DS, its hardware has been sold below cost because of its significant price cut in the fiscal year ended March 31, 2013.”
“However, Nintendo expects to cease selling it below cost by the middle of the fiscal year ended March 31, 2013.”
With the Wii’s life cycle nearing an end and the Wii U on the horizon, 2012 appears to be the time for Nintendo to further establish themselves for this next console generation. Yes, the 3DS is now selling like Nintendo intended it to do, but continuing profit losses from the device have put a damper on its big turnaround. Once again, even with less-than-positive news on Nintendo’s financial earnings, things are looking less and less grim with the 3DS moving more and more units. It’s been a tough climb for the handheld and Nintendo to say the least.
[Update] – IGN now reporting that Nintendo’s fiscal year loss is estimated at $530 million.