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Nintendo takes official $923m loss for first half of 2011

updated 10:50 am EDT, Thu October 27, 2011

Nintendo to post first annual loss in 30 years

Nintendo has posted a huge loss for the first six months of the fiscal year and expects the first annual loss in more than 30 years. While better than feared, the video game maker netted a loss of 70.27 billion ($923 million) in the six-month period ending on September 30, which compares to a loss of 2.01 billion yen just a year earlier. This is due to a mixture of factors, including slowing sales of the Wii, a weak global economy, and a comparatively strong yen that is bad for export profits.

For its full-year forecast that ends in March, 2012, Nintendo now forecasts a net loss of 20 billion ($264 million), which is the second revision in six months, both of them in a downward direction. The new prediction is twice that of the one in July, which forecast a 35 billion loss. This is the first annual loss since it started reporting consolidated earnings in 1981. Because it does its accounting based on Japanese standards, Nintendo doesn't post quarterly results.

Also, end users are facing more distractions for their leisure time, Nintendo President Satoru Iwata acknowledged, with smartphone games on the iPhone, iPod touch, and Android being big contributors. In the home, the Nintendo Wii is outdated and doesn't offer HD gaming like its main competitors, the PS3 and Xbox 360. Microsoft and Sony have brought their own versions of body movement controllers and interfaces with the Kinect and PlayStation Move, respectively, partly negating Nintendo's main advantage. [via WSJ]




by MacNN Staff

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Comments

  1. SockRolid

    Joined: Dec 1969

    +1

    One-trick pony

    Nintendo's problem in mobile is that a hand-held gaming device does pretty much only that one thing. Games. iPod touch does games, internet, communication, and tons of other things. Easier to justify the cost. Not to mention the 'cool factor.'

    And it's not just Nintendo's problem. According to Wikipedia, "From 2006 through the third quarter of 2010, PSPs have sold a total of 53 million units." Pretty impressive for a game console. Pretty pitiful for a mobile OS platform. And probably not sustainable.

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