Back in 2011, Nintendo was the undisputed top dog in the console gaming world. The Wii home console was outselling its rivals by a wide margin, reaching lifetime sales of 94.97 million units. The Nintendo 3DS handheld launched that same year, giving gamers access to 3D visuals on the go, without glasses. But there's a dark side, too: 2011 was also the last year that the Japanese company posted a profit.
In 2012, Nintendo released the Wii U. By Nintendo standards, it was incredibly unpopular. Consumer confusion stemming from the console's name led to poor sales, and many people didn't understand that the Wii U was a brand new console, not a Wii accessory. Additionally, the Wii U's GamePad, which was meant to be Nintendo's answer to smartphone gaming, still hasn't been embraced by most developers.
As a result, Nintendo was forced to halve its earning estimates, and the company only expected to make 20 billion yen (just over $160 million) last fiscal year. However, in its latest financial report, Nintendo announced that the company managed to beat their estimate. In the fiscal year that ended this past March, Nintendo recorded its first operating profit since 2011.
Nintendo reports that its net sales for fiscal year 2015 were 549.7 billion yen ($4.6 billion), leading to an operating profit of 24.7 billion yen ($207 million). The company will be glad that it was finally been able to turn a profit, but the big-N isn't out of the woods yet; overall sales are down by 4%, and the Wii U missed its sales targets, managing to shift only 3.38 million out of of 3.6 million units. Nintendo is hoping to sell 3.4 million more Wii U consoles by March 2016.
Although the New Nintendo 3DS and the New Nintendo 3DS XL “got off to a good start and continued to sell well,” the Nintendo 3DS is also struggling, as the other 3DS consoles “did not grow as anticipated.” Older 3DS models sold 8.73 million units, missing their 9 million unit target. However, the company expects games like Xenoblade Chronicles 3D and the new Fire Emblem title to help boost sales, so don't count the 3DS out just yet.
As for the future, Nintendo is hoping to post operating profits of 50 billion yen by the end of March 2016. With the help of DeNA, Nintendo will release games on smartphones; that move could help them to sell more Wii U and 3DS consoles, too. The company has also revealed that it is working on a new console called "NX," and while it's unlikely that NX will be released before the financial year is up, if Nintendo reveals more information about the console it could increase their stock price, leading to additional profits.