When Nintendo announced they would be substantially dropping the price of their 3DS handheld it was a move to entice uninterested consumers but also a major risk for the company. In essence, Nintendo would be taking a huge loss on the handheld in the hopes that, if the price cut stimulated sales, things would inevitably balance out. However, as the company has just revealed, things didn’t turn out exactly as expected.
Despite the 3DS now selling well Nintendo is still posting some pretty sizeable losses for the first half of the 2012 fiscal year (which ends in March of 2013), and unfortunately they are now much higher than Nintendo initially assumed they would be. Furthermore, Nintendo is lowering its net profit outlook by nearly 70 percent, a result of $350 million in first-half losses.
Nintendo is citing the poor performance of the 3DS overseas as a major cause for the huge losses and change in projections — as Japanese consumers appear to be less interested in the hardware, and by extension the software, than Nintendo initially anticipated. The 3DS has crossed 22 million units sold worldwide, but Nintendo is also lowering overall sales projects for the handheld by 1 million.
It’s not all bad news, though, as the company is reporting they expect 5.5 million Wii U consoles to be sold before the end of the fiscal year – the console launches in November – which should presumably help correct this downward trend. Moreover, if sales of the Wii U are at the level that pre-orders suggest they are, the console could, as Joystiq reports, bring the company back into the black.
It’s hard to nail what exactly resulted in the 3DS not striking fire like Nintendo had hoped, but most will point to the lack of enticing launch content as a major factor. It was only when Ocarina of Time 3D launched that hardcore gamers even took notice of the system.
A similar situation is at play with the Wii U, but thankfully Nintendo has ensured, at the very least, there will be plenty of launch content, even if a lot of it is multiplatform stuff. Games like Assassin’s Creed 3 and Black Ops 2 are going to be major players in a few weeks, and simply by virtue of offering those games Nintendo is sure to move a few extra consoles.
Do you think that Nintendo has lost the luster they once had? Or are they poised to make a comeback with the launch of the Wii U?
The Nintendo Wii U releases on November 18, 2012.
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Source: Nintendo (via Joystiq)
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The Wii U is the sword that Nintendo shall strike back with
Just because some (no, not all) retailers are out of Wii U preorders doesn’t mean that it will sell well. If we’ll all remember, all three systems sent no more than five systems to each store, meaning that preorders could have been sold out after just a few preorders. I don’t feel like people are looking forward to the Wii U as much as they were the Wii, because the Wii brought something new: motion controlled gaming. Even I was looking forward to it. Now, we live in a world of online gaming and tablets, and Nintendo is trying to capitalize on the latest trends, but they need to realize that they shouldn’t be trend followers, but more trend setters. They successfully set the trend for motion gaming, and here came the Kinect and PS Move. I believe the proper way to utilize tablets with gaming is precisely how Microsoft is doing it with Smart Glass by making it optional, but adding a higher level of depth to games. I don’t believe basing an entire console on the tablet is a good idea, and once people realize this, I think that Nintendo will see sales that are better than the initial 3DS sales, but not anywhere near as good as they hoped. At this point, all they need is a non-gimmicky console with some fresh, new IPs, as well as some sequels to already established IPs that are reimagined for this generation of gamer.
But other consoles have kept the formula the same. Most people don’t like change and now Nintendo is stuck between a rock and a hard place with people believing this will be bad as Wii or a rip-off of a tablet Xbox.
I’m not entirely sure what you’re trying to say, to be honest.
When I waited in line for the Wii launch there had to have been at least 15 consoles delivered. I don’t recall how many exactly, but I was #4 and I know there were a bunch of people behind me that all got systems. When I preordered my Wii U from Walmart there was room for 20 systems, at just my store, before they sold out. And they did sell out. I don’t know where you are getting your “no more than 5 systems” from.
Where exactly can you still preorder a Wii U from?
The reason I said “no more than 5″ is because at the walmarts and gamestops here, they said that every store is limited to the number of consoles they receive, and that every store will be lucky to get five Wii U consoles. Also, last generation, at all gamestops here, there were only 11 Wiis, 6 PS3s, and 5 360s at all three of my nearby gamestops, which would lead me to believe that we’d be seeing small numbers like that now too. Just because you saw room for 20 other systems at Walmart does not mean that’s how many they’ll have.
And to answer your question about where to preorder a Wii U, I know that just a few days ago, f.y.e. was still taking preorders, my local best buy still has 2 empty preorders left (and they only received 4), which means there could be other best buys that still have preorders available as well. The other store I know for sure is still taking preorders is Sears. I was in the mall earlier today and they said they will receive 5 consoles on launch and only one has been filled.
I’d love to have the optimism this writer seems to have. However, Wii U’s launch lineup is lackluster.
It does very little to entice core gamers with rehashes of old titles with questionable GamePad additions.
It also does even less to entice the casual gamer, Big N’s bread & butter with the Wii.
Biggest question – what is the Wii U system seller? Can’t think of an answer – not a good sign.
One last thing, check Ebay, tons of Wii U’s for sale, a few went for $799 early, but the gouging opportunity is shrinking as prices are dropping to near Retail – I saw a gouger only get $400 for a deluxe…yikes.
You have a good point. The two big games that this article mentioned for the Wii U were Assassin’s Creed 3 and Black Ops 2, and in all honesty, most people who care about these two games, or any of the third party titles on the Wii U, will already own them for another console. Black Ops 2 releases five days before the Wii U, so most of the Call of Duty audience will already own it for 360 or PS3, and same for AC3, which releases next week. Their key focus for launch is the third party line-up, but I have to ask this question: Why pay for another console for games I can play on a console I already own?
PS3 Launch Lineup
Blazing Angels: Squadrons of WWII
Call of Duty 3
Genji: Days of the Blade
Madden NFL 07
Marvel: Ultimate Alliance
Mobile Suit Gundam: Crossfire
NBA 2K7
NHL 2K7
Resistance: Fall of Man
Ridge Racer 7
Tiger Woods PGA Tour 07
Tony Hawk’s Project 8
And you think the Wii U launch is lackluster? WOW!
I would take a hundred NSMBs, Nintendo Lands, Tank! Tank! Tank!s, Epic Mickey 2s, ZombiUs, Scribblenautss AND all the rehashes, before I would want ANYTHING from the PS3′s lineup. Hell, you can add the 360′s in there too.
The Wii U launch lineup is one of the strongest in home console history.
Nintendo Land? Tank Tank Tank? Scribblenauts?
Thanks for making my point.
Well yeah..They can sell more than that..since they’re using kids to make more consoles..that’s not so fair..im not buying any product from nintendo..
this does mean the ceo of nintendo will be fired
Nintendo = Innovation
Sony&Microsoft = Imitation
When did Nintendo decide to give up? I mean they have had three mediocre consoles since n64 but the games have always made up where are all the great games?