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Nintendo Quarterly Profits Down 80%
mybrainonfire writes "1UP is reporting that Nintendo had a 78.5% reduction in operating profits for the quarter. 'Speculation from the news service on the reason for the drop makes perfect sense - the GameCube doesn't have enough exclusives, first-party and third-party, and sales of GBA SP and GameCube have been declining.' Time to release more Pokemon games, stat!"
http://www.gamasutra.com/php-bin/news_index.php?st ory=6051
re Shacknews: "Gamasutra points out that while Nintendo is suffering from reduced profits, neither Sony nor Microsoft's Xbox division are currently making any profit."
Unfortunately, the next major Pokemon release (Pokemon Diamond and Pearl) isn't due until early 2006 in Japan, and if they follow the same pattern in the US that they have done with earlier Pokemon releases, we won't see it in the US until at least the fall of 2006.
I personally like the Game Boy because of the Pokemon games (I still like Pokemon), and the Game Cube and Nintendo DS sounds nice, but the release of Sony's PSP and the upcoming release of the XBox 360 and Playstation 3 seem to be eating Nintendo's lunch right now, and those consoles aren't even out yet. Nintendo, on the other hand, isn't coming out with their new-generation console for at least another year.
I just hope Netcraft isn't confirming anything yet.
If you look for some hard numbers, it means that Nintendo only got about 3.75 billion yen in profit this quarter.
Sony's also annouced results today. Their game division finished the quarter with an operating loss of 5.9 billion yen. I don't know about Microsoft game division but I'm pretty sure they're not making money.
Nintendo execs. might not be dancing back in the boardroom, but I think they're happier than Sony and Microsoft.
Well, Nintendo's been on about the overall decline of gaming in Japan for a while now, and they've been promoting their DS as a solution to the problem. I haven't been able to find anything on Nintendo's earnings report to verify, but my traditional sources are US centric.
Without being able to read the fine details, the decline probably revolves around a lot. This quarter was relatively empty on the Gamecube; this is traditional among game makers, their big hits come in the Christmas gift-giving season. The DS really only had one big game for them: Nintendogs. While it did sell quite well, and broke into many non-traditional demographic groups, a single game can't really carry em. And while the DS is supposed to be the 3rd pillar of Nintendo gaming, it seems to truly be the replacement for the GBA, which is in decline and appears to be throwing a last hurrah this Thanksgiving. Another thing is that Nintendo traditionally invests a good part of their short term savings in US dollars, and a lot of their operations work in dollars. So when the price falls, they lose Yen, and everything costs them more. Overall, I think the strategy has helped them overcome the various problems the Yen and Japanese economy had over the past ten years, but it can crop up in times like this.
The good news is that they're on track for an excellent quarter. Twilight Princess should break some records and move some more Cubes. August appears to be the day in which the DS will explode onto the US mainstream with both Nintendogs and DS Wars on the same day. Now that's a back to school special. Jump Superstars is already looking to be a rather big hit in Japan for the DS, judging by preorders. It could also well be that Nintendo is paying forward a lot of money for advertising in the near future for all these big hits. Finally, remember that they're still making money, just not as much as the last quarter, which saw the sale of a couple million Dual Screens and games. Given that the market is up on their stock at the moment, you might expect next quarter to really take off if their plans succeed.
It's just a summer slowdown, probably happens nearly every year, only less pronounced when they aren't also launching a new handheld the previous quarter.
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More half ass stuff from 1up.They post what they want,so they can bash who they want.
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Sony=52Million in the Red
"Sony's game unit, which makes the PlayStation 2 and PlayStation Portable gaming consoles, saw a 64 percent sales increase to 105.4 billion yen ($941.1 million). But the division also booked a 5.9 billion yen ($52.7 million) operating loss due to marketing and research expenses. That loss widened from 2.9 billion yen the previous year.
Shipments of the PSP, which went on sale late last year in Japan and earlier this year in the United States, totaled 2.09 million worldwide, while PS2 sales rose nearly fivefold to 3.53 million units. "
http://www.forbes.com/associatedpress/feeds/ap/20
Microsoft=178 Million in the red..
"A 22 percent spike in Xbox sales narrowed the company's losses in its home and entertainment division to $179 million, compared to $340 million a year ago.
"I think that, to some degree, validates Microsoft's business model in getting into the console space in the first place," Rosoff said. "Microsoft is selling more games and fewer consoles, and that's really the business model. They acknowledged it would be expensive to get a foothold in the market."
http://www.forbes.com/associatedpress/feeds/ap/20
Nintendo=In the black with a thing called PROFIT
Read there returns here.
http://www.nintendo.com/corp/annual_report.jsp
Nintendo is not going to be closing up anytime soon.They have made a big profit in seven of the past 8 quarters.Barly red in the 8 to make any diff for the year, which was deep into the black.
Sony has been hit and miss.There game part of there company has been one of the few things making any money, even tho they have to sell 2-3 times as much as nintendo to make even close to same profit.
Microsoft has only had one quater of profit sense the xbox has come out, if it wasn't because they have a big company to back it up, it would have been canned a long time ago.
From a far more informing Gamespot article here
"It also can't be understated that Nintendo saw a profit in its last quarter. By comparison, Sony Computer Entertainment today reported a quarterly loss of 5.9 billion yen ($52.6 million). Last week, Microsoft's Home and Entertainment division, which makes the Xbox, said it lost $179 million during its last quarter.
I'd take a profit over a loss any day of the week. It's also the first time Sony has ever had two back-to-back losses.
Source: http://www.businessweek.com/smallbiz/content/mar20 05/sb20050331_4850_sb040.htm
While I'm no expert on the subject, I'm afraid I'm going to have to challenge you on a fact or two....
Stern Electronics, the 80s manufacturer of arcade games (including some pinballs), is not the same thing as Stern Pinball, although Gary Stern was involved with each of them. Stern Pinball is what used to be Sega Pinball, and before that, Data East Pinball. It's a pinball division that's changed hands, and been renamed, a few times. It doesn't make sense to say that they've "survived" all this time; only recently have they become an independent company, bought off Sega by Gary Stern (who had been an employee).
Stern Pinball, in whatever form, has never known for making the best tables. When Williams (who also owned Bally) was in the market, they were king. When they left the market, dismantling their pinball division and firing several star designers including Pat Lawlor (Addams Family, Twilight Zone), that basically meant no one was making pinball games anymore.
Gary Stern saw the opportunity to get into the market. Stern seems to genuinely love pinball, and so has more than a monetary motive in buying the company. Without Williams in the market, he saw that it was possible to make a profit, if he were the only real pinball manufacturer in the world. He's in a very precarious position, however -- if someone else starts making pingames, he could go under easily. Fortunately for him, that seems unlikely.
On to point two:
The PS3 and X-Box 360 will certainly be more powerful than the current generation of machines. But there is an amazing amount of hype flying around concerning them right now. In light of the promises made concerning the PS2 and X-Box back at their release, I'm taking whatever either company says with a three-ton grain of salt until the systems are actually released and the play of their games can be assessed.
Point three:
I'm not certain that neither Sony or Microsoft's game division will not make a profit. I'd put more money on Sony than Microsoft. Nintendo is not in as much trouble as the article seems to suggest -- reading the original article sources makes it clear what happened is that Nintendo had a large R&D charge this year, probably from development work on the Revolution.