Nintendo posts 52% decline in profit amid weak Wii sales

By on October 29, 2009, 1:30 PM
Nintendo posted a major 52% slip in fiscal first-half (April-September) profit today, amid a slowing demand for its Wii video game console. Profit for that period totaled $69.49 billion yen (about $772 million), which is down from 144.83 billion yen in the year prior and less than Nintendo's forecasted $100 billion yen ($1.1 billion). Fiscal first-half sales plummeted 34.5% to 548.01 billion yen ($6.1 billion).

The company expects earnings to remain grim, lowering its sales forecast for the fiscal year through March 2010 to 1.5 trillion yen ($16.7 billion) from 1.8 trillion yen ($20 billion). Nintendo blames its weak outlook on the recent Wii price cut, a lack of blockbuster games, as well as a strong yen, which hurts Japanese exporters by reducing their overseas earnings.

Nintendo has faced some stiff competition lately, with Sony and Microsoft both lowering prices on their consoles. The PlayStation 3 topped September sales charts after Sony introduced the $300 120GB Slim model, and the 120GB Xbox 360 Elite was cut to $300 as well. Microsoft also has a $200 Xbox 360 Arcade unit, which is about the same cost of Nintendo's Wii.




User Comments: 33

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fref said:

Amazing how quickly things can turn around. Not long ago, Nintendo was at the top, selling the most consoles and games.

Colonel Lance said:

I have thought that this inevitable decline in the Nintendo Wii has been very long in coming. When the Wii first came out it was awesome, it's control structure unheard of and it had some interesting games that took advantage of that system.

However, to me, the Wii has become pretty stagnant over the last several months and this drop in sales is definitely not a surprise to me, especially with all the price cuts on the Xbox and ps3.

freedomthinker said:

Mm... how the mighty fall bit by bit . Nintendo will need a miracle at this point

Vrmithrax Vrmithrax, TechSpot Paladin, said:

The decline doesn't surprise me at all... Wii captured the imaginations of a ton of people, many in demographics like "new to console gaming " or ones you would never think of as gamers. But there is only so much of that type of demographic to go around, and that big boom of sales has dropped, as sales of other consoles with a bit more meat to them is on the rise. Pricing is part of it, titles and continued content is part of it, but other factors (like economy and time of year) play big parts in it. If people are having to choose between buying a Wii now, or waiting a few months to get it as a nice holidays present, guess which will usually win out in a tight economic environment? Well, as long as the consumer has a smidgen of willpower

jurrasstoil said:

Well, what a surprise...

Now they could start making or at least help developers make good games instead of just riding the hype. There are like 3 or 4 good games for the Wii. A laughable number considering that the Wii is around for THREE years now.

The idea behind the console was good and so were the first months after its release, but once the hype was over and there were no good games coming, it turned into a big failure imo.

(i own a wii...)

TomSEA TomSEA, TechSpot Chancellor, said:

Nintendo is resuming it's normal 3rd place role in gaming consoles behind XBox and PS2/3 as part of the "natural order."

Let's face it, the Wii was a novelty - and a very clever novelty, especially for bringing in non-gamers. But you're either a full-time, serious gamer or you're not. And once that novelty wore off, the non-gamers walked away whereas serious gamers are still on the PC, XBox and PS2/3. Plus cutsie Pokeman-like kid games only go so far and that's what the bulk of Wii games are.

Like other posters, this doesn't surprise me in the slightest.

Cueto_99 said:

Anyone could see it coming... the only good games for Wii are the ones made by Nintendo itself, maybe one or two from other companies, but the majority are from Nintendo... Anyways, I think they should start designing a new 2nd version for the Wii, personally, I would like revamped graphics and a hard drive...

treeski treeski said:

I figured this would happen at some point. It's not really surprising. I think Sony and Microsoft have been doing more to better their systems than Nintendo. That being said, I don't think Nintendo is in trouble necessarily. They could turn things around again if they play their cards right.

Xclusiveitalian Xclusiveitalian said:

Nitendo already has sold 50 million plus consoles which is a huge profit, eventually they had to stop selling so much, i think it's the ps3 price dropped that's taking away a lot of sales since there profit has rose 300%.

salbar1981 said:

Nintendo has lost plenty of ground lately ... even if wii is $50 cheaper there hasn't been any good title recently :S

lynxon said:

I think it's about time the Wii stops selling as much as it has, I mean eventually everyone has to have one of them.... And with Sony's only recent smart decision, the new PS3Slim, stealing all the market share it may finally be time for the Playstation to shine again.

Clrabbit said:

Poor Nintendo... they've only made Billions and billions of dollars of there sad little Gimmick.

From the hardware there using they could sell the thing for $89 and still be making good money, and then it might be a value for the user buying it.

Looking at EBgames most of the new games cost $50!? I mean $50 for games that are of Classic XBOX quality. If they were $25~35 you'd have value.

My issue with Nintendo is there making low-end stuff and selling it for High-end Prices.

I personal wished people were still making games for the GAMECUBE like they are the PS2. I've spent many a thousand hours on my GC. Which I picked up for under $100 and all my games bought used for under $15 expect PSO bought new for $30. Now that was value. $240 in games + $100 for the system +$30 in memory cards = $370 for around 3,500~4,000hrs of game play and counting.

A Wii still cost $200 and $50 a game or $35 for the good used games. so even buying used games for the same I have in my GC i'd get 1xSystem and 4 Games, and a memory card.

GC: 1x system 2x controller 6x Memory cards and 16x games

Wii: 1x system 1x controller 1x memory card and 4x games

Seems like paying a lot more for a gimmick.

Any of the good Wii games could have easily been made for the GC "Zelda Princess of darkeners" even had a GC version it was just really rare.

For every body wondering GC price droped to $99 on September 24, 2003 just a couple days past 2 years from it's (September 14, 2001) release date.

The Wii is still $200 and its been on the market for (November 19, 2006) 3 years next month.

Wii day 1 price $250 Year 1 price $250 year 3 price $200

GC day 1 price $200 Year 1 price $150 year 3 price $100

So that's just trend any body knows hardware dramatically gets cheaper every year. PS3 $600 vs todays $300. So all I'm saying is Nintendo has made a ton of money for selling outdated hardware, using outdated light gun technology (In the in box Wii motes, they do offer an upgrade to make it better Wii? MotionPlus for $25 more. Which strikes me as irritating it would be like Sony selling a cheap PS3 pad with there system and making you buy your first 6 axis.)

I'm not even saying the Wii is a bad system, just a bad value for the money.

I remember the first Demo Nintendo put out for the "Revolution" it showed a head mounted display and a head motion tracking version of Metroid prime. I was excited as all get out for the Rev... up tell they finally showed there controllers and system specs.... I was expecting X360 hardware with the visuals they were promising, and we get 2xGC worth at best.

I'd hope Nintendo dose better next round for the real gamer and not just target the causal gamer, but I debt it. My money's on Microsoft.

Deso said:

about time the WII starts to sell worse, I literally have no clue how it was so successful, when everyone you talk to who has a wii got bored of it very quickly, only good game it had was mario series

paynetrain007 said:

I knew it wouldn't last. The Wii craze was just a fad among non-gamers.

tonylukac said:

I seem to remember they are all losing money on these devices.

9Nails, TechSpot Paladin, said:

Tonylukac, it was said that Nintendo could manufacture the Wii for about 180, and they sold at 249. So, not including research and software development, the product could have been profitable shortly after launch. A Nintendo spokes person had said that with this price point they were able to lower the cost to license their software, which allows them to charge $49 and not $59 for software titles like Sony or Microsoft does.

With any luck, Nintendo will capitalize on the large install base that they now have and not let the fans down.

Guest said:

I own all three systems (kids play with the wii and 360 the most), I use the 360 and the ps3 (like them both equally)...the point is... the following comments are not 'wii fanboy' based.

Based on most of the comments, it seems that most people are considering the Wii to be 'washed up'...and it's about time that they're not doing as well as PS3 / xb 360.

The reality is...Nintendo is the only one that is making any serious money. Both MS and Sony are LOSing money with their systems. And even with the sales slowdown, check out the sales charts, and you'll see that the Wii is CURRENTLY selling almost double (globally) what the PS3 is selling, and more than double what the xbox 360 is selling.

For the facts, check out http://news.vgchartz.com/news.php?id=5707

You'll see that the wii sold 390K units last week, which is 9% lower than last year at the same time. BUT the xbox 360 only sold 138K units...down 35% from same time last year, and the PS3 sold 220K units (down 31% from last year). The ps3 numbers reflect recent price reduction and introduction of uncharted 2, and have already dropped from week prior (-6%).

As many have pointed out, it was unrealistic to expect the Wii to continue selling at the stratosphere numbers they've been selling at for the past 3 years. So, they've had a reduction...it's still double what the other units are selling (even with all the crappy games for the wii).

The good thing is that MS and Sony have learned some things about being innovative, and I'm optimistic that all three hardware providers will try to outdo each other with the next generation. I'm looking forward to the next generation of advanced interactive adapters/controllers.

We're all winners in having these companies compete so aggressively for our attention. So, those that are looking for the Wii to fail.....don't hold your breath...it won't happen any time soon!...and that, is a fact!

MBK MBK said:

My mate has had a Wii since release, and being the nintendo fan boy he is, felt the need to get the stand, speakers etc etc.

But even he admits that it is a failure of a console. The only game we have played consistently since it's release is Super Smash Bros Melee (or whatever it's called) and Wii Sports. All the good games for the Wii seem very...child oriented, which when you look at other games platforms, might not be a bad thing as they seem to be lacking in kid friendly games. Though the failure of the Wii shows that young adults are where the money is in games and they seem to buy guns, cars and blood.

When the Wii was first announced I was taken in by the new controller hype, but nothing has emerged. Yea, they've brought out the new "better" Wii mote, but no games developers seem to be exploiting the controll system, there has to be more that can be done with the Wiimote and the balance board than yoga, tennis and sword fighting...

ken777 said:

The Wii fad had to end sooner or later. It was innovative, but just too underpowered to have the longevity and breadth of games of an Xbox 360 or PS3. And next year, everyone's going to have motion sensing controller support. Time for Nintendo to come up something new.

SNGX1275 SNGX1275, TS Forces Special, said:

New Super Mario Brothers Wii is going to get a ton of sales, it comes out Nov 15th. Haven't seen a gameplay video yet, but have seen stills and a review on gamespy of it. Looks pretty sweet.

mattfrompa mattfrompa said:

I've got my tiny violin ready for Nintendo...I haven't used my Wii console in months, and don't really intend to until Mario Galaxy 2 or Epic Mickey. Love the increased amount of comments on the sire btw

BlindObject said:

I think everyone that everyone who wanted to get a wii already has one, and now only the people who say "Hm well, I can afford, so why not?" and buy it. But I'm sure more sales will come with Holidays approaching.

Jibberish18 said:

Awwwww. Nintendo made a lower PROFIT (Still a profit) after months of killing it with their overpriced hardware.

And then there's news like this.

For the facts, check out http://news.vgchartz.com/news.php?id=5707

You'll see that the wii sold 390K units last week, which is 9% lower than last year at the same time. BUT the xbox 360 only sold 138K units...down 35% from same time last year, and the PS3 sold 220K units (down 31% from last year). The ps3 numbers reflect recent price reduction and introduction of uncharted 2, and have already dropped from week prior (-6%).

[link]

Razerblade said:

The problem is that most people who want a Wii and DS now have one so they cant expect to keep getting the same amount of sales! The other problem is there isnt that many serious games you can play on the Wii so they cant be selling a massive amount of games either!

red1776 red1776, Omnipotent Ruler of the Universe, said:

my daughter keeps her Wii in the closet between a tickle me Elmo and a furby

swilllx2p said:

Like many others my Wii has largely set unused since i've had it last christmas. It was awesome at first, but my interest in it fell off quickly. There are some games I want out, like the new tiger woods...but its just not worth the money when i know it will sit unused after a month or less.

teklord teklord said:

Wii has some cool games but all serious gamers couldn't stand that it was just barely more powerful than a GameCube. Bring on the next gen Nintendo system and this time make it current tech.

lesajm said:

This doesn't surprise me. I know families struggling to keep food on the table and the lights on. They aren't out buying Wii's or any other gaming systems right now.

I suspect card games, board games and video games for older gaming systems to be bigger sellers this season.

LikaLaruku said:

When the Wii came out, it immidiately reminded me of the failship known as the Power Glove. To top that off, lots of hit games like Batman Arkham Asylum & Ghostbusters & an ungodly amount of others came out on PC, possibly Mac, & every console BUT Wii, so...saw it coming.

Rig said:

I think the Hype with the motion sensing controller is finally levelling off now. ;P

I've probably started a riot saying that now XD

JieMan JieMan said:

As the cost of the XBOX and PS3 declines I think people will choose the better graphics over the game cube ( I mean WII ) .. Sony probably has had the most direct influence over this with there price cut ..

Lardy1664 said:

With the onset of Christmas shopping and some cleaverly bundled packages Nintendo could get some of the sales back.

The console always proves a great piece of entertainment at ours when there's a gathering of different generations. After all this is the way it's been advertised. I've never really considered it as an out and out games console for you to sit infront of in a darkened room, killing hordes of renagade soliders.

Wagan8r Wagan8r said:

"Weak sales" and "grim earnings"? I'm not so sure Nintendo is doing as badly as the article states it is. The Wii is still outselling the other consoles by a large margin.

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