Nintendo Recovers To Net Profit, But For How Long?

Steve Anderson : End Game
Steve Anderson
The Video Store Guy
| The video game industry has gone from a mole hill to a mountain in no time flat, Chris DiMarco is your Sherpa as you endeavor to scale Mount “Everquest”

Nintendo Recovers To Net Profit, But For How Long?

Some great news landed for Nintendo recently, but at the same time, the news was underscored by a bit of a hit for the company, and one that may have some considering Nintendo's long-term viability as it relates to being in on the console wars. Nintendo brought out its quarterly numbers and showed a net profit, but some downright dismal sales on the Wii U.

The good news is as mentioned, a net profit for the quarter, and Nintendo further left untouched recent guidance from the company that suggest a 100 billion yen operating profit for the current fiscal year. But bad news quickly followed as not only did Nintendo reveal an operating loss of 4.92 billion yen—right around $50 million, as exchange rates go—but that was on net sales of 81.5 billion yen, around $830 million, rounded off. Potentially even worse was what made up those numbers, particularly sales of just 160,000 Wii U consoles in the quarter.

Considering that the Wii U is just under a year old, that's a downright terrible sales number, but the numbers were recovered on the strength of improved Nintendo 3DS sales. Nintendo sold fully 1.4 million such handhelds for the quarter, which is up on the previous quarter by fully 12 percent, but down 25 percent on the year ago. But software for the 3DS wasn't a problem either, with “Animal Crossing: New Leaf” and “Tomodachi Collection: New Life” kicking in big numbers.

But this too comes back to the big problem that the Wii U has faced almost since its inception. The games are simply not there in the kind of numbers that would compel people to buy the consoles. Now, Nintendo had previously expressed a plan on this front, which is being realized now thanks to things like the upcoming “Pikmin 3”, which has already been released in some countries. With Nintendo developing and releasing its own titles, that's the kind of thing that gives other publishers some incentive to develop for the Wii U, as well as providing the necessary incentive for gamers to actually buy one of these things.

As important as hardware is—indeed, as vital as hardware is—the games are every bit as vital, and as we're discovering here, potentially more so. Without games to play on this system, it's really little more than an overpriced paperweight, which gives at least a possible explanation of why the recent quarter was so thoroughly dismal for the Wii U.  Nintendo needs more games hitting the system, and it needs these games in rapid fashion if it expects to make the Wii U a viable alternative to the upcoming PlayStation 4 and Xbox One.

Chances are there's quite a bit in Nintendo's development camps, and this is a good thing; a very good thing, really. But it's going to have to get out of development and into gamers' hands—and quickly, too—in order to really do any good. Nintendo needs to take full advantage of the holiday shopping season that's coming up in a little over two months or so, but to do that, Nintendo needs something for gamers to actually buy.
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