Nintendo Announces Net Loss, New Prices

Daetrin writes "As reported by CNN/Reuters, Nintendo announced that they expect a net loss for the first half of the financial year, from April through September. Nintendo claims this is mainly due to exchange rates, as the yen has appreciated against foreign currencies during that period. This is reported as the first loss for Nintendo since its establishment. The projection for the full fiscal year was reduced to a [still significant] net profit of about $542 million U.S. Nintendo also announced further price cuts in other territories to follow the cut to $99 in the U.S.: 'Beginning on October 10, the console will have a suggested retail price of 79 pounds (approximately $131.8 U.S.) in Britain, and 99 euros (approximately $115.4 U.S.) in continental Europe. The new price of the GameCube in Japan is now 14,000 yen (approximately $126.5 U.S.)'"

Comments

Yen Problems

[BigDork1001]

Taken from a story at planetgamecube.com : Nintendo blames much of the losses on the unexpected appreciation of the Japanese yen, citing roughly 40 billion yen in foreign exchange losses for the time span. Nintendo also disclosed it had originally planned to reduce the GameCube's price earlier in the year, and expects the new price to vastly improve sales during the holiday season.

Nintendo just dropped the price of the GC. Now sales have gone up significantly. And with the sales of the consoles are sales of games. I'll bet that Nintendo will be back in the black real soon.

Re:Yen Problems

[Anonymous Coward]

Also: On top of the price thing, very soon we have Super Mario Kart coming out, followed immediately by the christmas season.

The N64 was not a great game machine, but it was used widespread, and for 90% of the people who played it, if you asked them what the N64 mean to them, it was Goldeneye and Super Mario Kart. Maybe Mario Party.

This means, if nothing else, revenue.

How much?

[Anonymous Coward]

I wonder? To which degree did each of the following contribute to this loss, and is there any way to know?

1. The currency exchange rate changes, like Nintendo says
2. This last six months has been a very dry spell for Nintendo games. There were some itermittant cool things for GC (Mega Man!) and a handful of GBA masterpieces (Wario Ware, Castlevania AOS), but by and large after Wind Waker there wasn't a lot of activity on the new Nintendo games front until September. September marked the beginning of a huge three-month wave of really really good Nintendo titles, but still. Has this affected Nintendo's sales?
3. There have been vague rumors of Nintendo announcing the GC2 and/or GBA2 at the next E3. Could some of their potential profit have been eaten up by the development costs for that over the last six months?

If Nintendo really lost money because of the Yen thing, then we should be able to go back, look up the changes in Yen over the last six months, and determine exactly how much money Nintendo would have made if not for the Yen thing and see if it would have been a profit, right?

X-Box

[nippinout]

The X-Box has yet to turn a profit for the Home & Entertainment division at Microsoft. -2.3 billion in video games.

Idea time

[DumbWhiteGuy777]

I still say that if any console released an SDK, they would beat the others overnight. They'd lose all their income from licensing fees, but their console sales would be through the roof with all the games that would be popping up, and games really do make the system.

You're actually right

[yerricde]

if any console released an SDK, they would beat the others overnight.

That would be PS2 and GBA, the top two non-PC game systems in the States. The PS2 console has Linux for PlayStation 2, and the GBA handheld has the unofficial DevKit Advance and a community around it. So the systems with publicly available development tools have the biggest market share, even if the relationship isn't exactly causal.