Report: Nintendo banks $6 on each Wii sold

Forbes says console maker's budget-line console earns slim operating profit on each of the nearly 35 million consoles sold.

For this generation of home gaming consoles, Nintendo exited the technological arms race that had fueled the industry since its inception. Rather than opting for the bleeding-edge tech specs adopted by rivals Sony and Microsoft, Nintendo built the Wii using dated technology and an innovative motion-control input scheme. The gamble, of course, has thus far paid off in spades, with the Wii's nearly 35 million units in global lifetime sales easily outpacing the Xbox 360's nearly 23 million systems and the PlayStation 3's nearly 17 million units. (GameSpot initially reported inaccurate PlayStation 3 sales figures provided by Forbes, which underestimated sales by 4 million. GameSpot regrets the error.)

Nintendo's little money maker.

In stark contrast to Sony and Microsoft, Nintendo also reaps the added benefit of making a profit on each Wii sold. Citing Macquarie Securities analyst David Gibson, financial news magazine Forbes reports that the publisher makes a $6 operating profit on each Wii sold at its $250 asking price. (Forbes incorrectly lists the Wii's price point at $260 and the PlayStation 3's price at $300.) Nintendo had not responded to GameSpot's request for comment on this figure as of press time.

Forbes goes on to note that Nintendo is besting its competitors in other ways, as well. Nintendo will reportedly be responsible for 60 percent of the 220 million games sold for the Wii this year. That stands in marked contrast to Microsoft and Sony, who respectively stand to publish 30 percent of 125 million Xbox 360 games and 15 percent of 120 million PS3 games expected to sell in 2008, according to the financial magazine.

Nintendo's operations may be hampered by a strengthening yen in the global economy, but the Japanese gaming company is still pulling in gobs of cash. Reporting on the first half of its fiscal year in October, Nintendo announced net income of ¥144.8 billion ($1.55 billion) on sales of ¥836.9 billion ($8.98 billion).

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188 comments
triclops41
triclops41

A major part of the reason the Wii is such a successful idea is that Japan's gaming population showed the future trends in gaming sooner than in other parts of the world. Their core gamer market was already declining, and Nintendo figured out a way to get beyond just the core market. MS and Sony didn't see that; they were still fighting over core US players from last gen, and ignoring what would be happening in the near future. Too many people think the Wii caused the shift to including more accessible gaming. That is not true, It was inevitable, Nintendo just figured it out first. Nintendo isn't starting a trend of ignoring the core gamer, but the core gamer is jealous because she is no longer the only girl the video game companies are courting.

triclops41
triclops41

you guys dont get it the wii is winning, but only because they saw the future a few years ahead of everyone else. the incremental graphical improvement that the next gen will bring over this one means that you have to distinguish yourself in another way. Microsoft and Sony wont regress graphically, but they wont put themselves in debt as much next time, just to get a slight increase in graphical technology. Computing and and internet navigation have realized its more than how good you look, the most important thing is useability. That is how you reach more customers. This is a good thing for gamers. EA and Activision/Blizzard won't stop making core games just because they want to get a slice of the Wii pie. Valve, Bioware, Blizzard, etc wont start making Wii minigames. All of the 1st person shooters everyone is so afraid of losing are still profitable and will still be made. But the variety of games will grow. Just because the casual market is growing faster than the core market doesn't mean the core market is dying. it just means its inherently limited. The core market can only grow very slowly because its already close to maximized. The casual market has just barely been tapped at all. Every year there are more good or great core games to play than there were the year before. That wont change no matter how much the casual market grows because they aren't competitive, they are complementary.

Ogelthorpe
Ogelthorpe

a) The Wii is winning. Lets not deny the obvious b) The fact that the wii is winning is not a good thing. If M$ or Sony decides to copy the approach of awful hardware+ps2 quality games+gimmicky controls+last generation technology...hardcore gamers are SCREWED.

LordOcelot
LordOcelot

The Wii is not in direct competition with the PS3 and 360. Both Microsoft and Sony are dueling it out, while Nintendo is targeting a totally different spectrum of young teens and families compared to MS and Sony's hard-core gamers. Almost everyone who owns a PS3 or a 360 also owns a Wii (I know I do). Since the release of the PS3 Sony has been playing catchup to Microsoft, and will continue to do so unless they get more quality exclusives. MGS4 was a great step in the right direction, but as more and more titles are becoming cross-console I see it becoming harder and harder for Sony to catchup. Also, blu-ray winning the format war was a substantial boost but clearly not enough. I want to like the PS3, but spending all of that money to get a few games does not warrant me a purchase. Say you bought a 360; stick with that and If you bought a PS3; stick with that. So far there is no reason to own both (unless you are a die hard fan of blu-ray, but DVD is fine and cheaper too). I won't get into console specifics such as Xbox Live Experience, or PlayStation Home because that's a grey area in terms of gaming. If you are a fan of Sony, get a PS3. Same goes for fans of MS and the Xbox.

jenova
jenova

The Wii will never win, not while there are people who actually enjoy playing real video games. Nintendo has a sound marketing strategy, it's plain as day. They still don't have the game library as the PS2 or Xbox 360. Sorry guys, they just don't. The 360 is where it's at if you're a gamer. Red Rings are fixed quickly, if you even get them at all, which isn't as likely as timid internet Japanophiles would have you think. If you haven't tried the 360, then you really are just spouting propaganda. And the PS3? Heheheheh. The PSP is great, but the console has a horrible dearth of games. If it's multiplatform, it's consistently better on the 360.

Drkr_Zen
Drkr_Zen

"things are now all hunky dory." I lol'd. MS wouldn't have even had the problem to begin with, if they would have just taken their time... it was entirely preventable, but all they saw were dollar signs as they abandoned the failed XBOX so early (another year, or continued support like the PS2 could have made it better). There's even been news of Elite consoles still RRoD'ing... which has still got me wary of the console, even though there's a few games on it that I want to play. 3 years RRoD warranty is "hunky dory", sure, but 3 years OF RRoD is inexcusable.

darksteel88
darksteel88

You'd think they would make more, but at $6 on 35 million is quite a bit. Good for us though. And even though the Wii may have outdated graphics, it's really providing a lot of new stuff, making it truly the best new-gen system. Motion controls (which aren't bad and will be better soon enough), nice virtual console implementation among other nice channels. They may be geared mostly towards younger children, but you cannot dispute that they're doing something right if they're banking good money in an economic crisis.

pakbeats
pakbeats

Even tho sony might be last in sells n profits i think they did wat they was suppose to do make something we did or didnt have before and make it a NEXT GEN system.Just look at the box in the store and see all the $h*t thats on it.N truthfully PC is the best.

yatatabien
yatatabien

LOL, I thought they were banking more money

andrew_ribbons
andrew_ribbons

Alas the rise of the casual gamer....and Nintendo's reaping of that market. For in doing so, they have won while they have lost. They have won marketing success, but they have lost the gamer, instead to be replaced with soccer moms, grannies in old folks homes and little kids. Thankfully, Microsoft reframes from cashing in on the easy $, and instead helps produce games of great quality and prowess for it's platform. Microsoft also used the tactic of selling their consoles at just under cost value, but due to high games and accessories attachment rate, not to mention profits from it's Xbox Live services (all of which are of high standard i should note, and worth the asking prices respectively), they now more than make up a net profit, as GS has posted numerous times. And all the stuff about 360's failing is old hat now. Yes the first few batches may have. However, ever since the July 2007 hardware update to new 360s being sold, not to mention the 3 years RRoD warentee MS has kindly provided free, things are now all hunky dory. Sony don't know what they're doing, i seriously cannot see their direction or motives, just flailing about trying to convince everyone that the most expensive console must be the best. Well face it, it's clearly not.

athenian29
athenian29

So, if Forbes says that they make $6 per Wii, and they list the price as $10 too high, does that mean that Nintendo actually loses $4? I'm so confused...

chimairawr
chimairawr

mariokart64 Name me some successful 3rd party exclusives on the wii. Because it seems to me that the console has been successful mainly on the back of the established Nintendo franchises like Zelda, Metroid and especially Mario, and then casual first party games like Wii Fit.

Mugen76
Mugen76

[This message was deleted at the request of a moderator or administrator]

Sins-of-Mosin
Sins-of-Mosin

No surprise they are making a profit. They are using old technology and cut out basic features like dvd play back. The price of $250 is a rip off, should be $150.

Unholy_Terror
Unholy_Terror

Holy cr@p, a company making a profit on selling the console! and I'm really not being sarcastic

trodeback
trodeback

Just another note. I've owned an Xbox 360, I know a few people with a Wii, and I have still yet to know someone personally that has a PS3. That just goes to show from my own perspective what sells more and what doesn't. Wii>Xbox360>PS3

trodeback
trodeback

When Microsoft and Sony were trying to create these powerhouse consoles Nintendo created the underdog of graphics and came out on top. I honestly though before the Wii Nintendo was a lost cause.

isaacmj
isaacmj

As long as Nintendo has Shigeru Miyamoto they will never lose.

malfarf15869
malfarf15869

while i don't really care for the Wii, i can't help but admire Nintendo. they moved from 3rd to 1st practically overnight. congrats

jjdomo
jjdomo

i'm pretty sure MS and Sony are taking a loss (or a tiny tiny small profit at best) with each console they sell. I think they make most of their money off the games.

mariokart64fan
mariokart64fan

this gen is nintedos time, ive said it was coming during the gc gen , heres reason being nintendo has gained respect for 3rd party publishing and has with the ds and wii thus far had more 3rd party exclusives, then ps3 and 360 does combined, add nintendos to that list, it be a disaster and they priced it right, yes its xbox 1 technolgy , , but its good enough timesplitters 3 and burnout 4 any one, re4 looked awsome on gc, so ya, and they certainly didnt confuse the consumers by releasing 3-5 different models just to drop the price of its current console also they never needed to rush ahead of competition to reach top, each time nintendo reached the top aside from nes, (their starter) they released its console or handhelds behind the competition i think to study their mistakes and advantages, lets look, n64 ps1 saturn they did good then , sure not much 3rd party but it was enough to secure 2nd position , last gen they took 3rd not once were they last, sega took honors for that almost every gen actually every gen lol, and now the standings are wii-35 million plus that was 2 weeks ago, 360 21 million plus , , ps3 just neared 13 million each system is a good 10 million units apart ,,

mariokart64fan
mariokart64fan

6 per console is better then what sonyt and ms makes lol, they make minus brackets lol, this is not including games and accessories vc wii ware titles nintendo sells, as well as ds 6 on wii plus another good sum for games accessories and ds

StuDevo
StuDevo

@BLuFAlc0n I can accept that the wii will win, but it isnt a better console than the ps3 or 360. It is just different and is cheaper than the rest and viewed as more family friendly. Also I'm sorry but the Gamecube didn't have better graphics than the ps2. The even the wii doesn't have better graphics than it.

fif
fif

Remember that the total cost comes from many sources: raw materials, labor costs, electricty used to power the factory, and then don't forget transportation costs. The big obstacle that stands between Americans and their Wiis start with a little something called the Pacific ocean. It adds up.

santiagochile
santiagochile

Don't you mean they make $60?!?! I own a Wii, and I can assure you that it does NOT cost $244 to make.

PandaBear86
PandaBear86

@kavadias1981 - Take a look at the Wii's hardware specifications and tell me, do you think such underpowerwered machine with 88mb RAM and 729mhz processor is worth $250? You can buy a second hand PC for that price and blow away the Wii's specs.

FallenOneX
FallenOneX

One of the main things to keep in mind is that a lot of Wii owners own other systems. I see it more as proof that the gaming market can support 3 consoles and the PC with no loss. No company is in danger of leaving the console business like in the 90's

Unabomber256
Unabomber256

Whats all this talk about "winning"? This isn't sports, they don't hand out trophies at the end of the systems life cycles. The companies will "win" if they are still in business next year and the year after and so on. The Wii targets a different kind of user than the other two systems and has done well as a result. Each system has its own niche, even the lagging PS3 has seen an increase in sales.

Vote_For_McCain
Vote_For_McCain

My girlfriend bought a Wii and she loves it. I can't stand it on the other hand and would rather play my 360 or ps3.

burstlimit514
burstlimit514

i aggree with Jose. Pretty much the wii is for little kids and most of the games suck. The reason the wii is selling is because parents and grand parents are being fooled. (no offense) If your going to get a game system then get the 360 arcade bundle or the ps3 bundle. Their will be games for the WHOLE family. I doubt dads will really want to play bunch of rated E games. Esspecialy ones that suck.

josetaveras
josetaveras

[This message was deleted at the request of a moderator or administrator]

BLuFAlc0n
BLuFAlc0n

people say that the Wii has no good games, and it won't win... Face it, Nintendo has WON the 7th gen wars, because only the Wii is the 'REAL' next-gen, 360's are a shiny version of PS2, while PS3 is an upgrade of PS2. The Wii, is original! Well, there's hardly any good 3rd party game for Wii, because those game developers are slackers and couldn't be bother making good graphics for Wii, and just using PS2 graphic engines. The Wii might have weaker graphics than the 360 and PS3, but we all know that the Wii wins. Go back to the last 2 gens before.... PS, N64, Saturn... Which has the weakest graphics? PS Who won? PS PS2, GCN, Xbox..... Which has the weakest graphics? PS2 Who won? PS2 Now, Wii, PS3, 360....Which has the weakest graphics? Wii It's guarranteed the Wii wins this gen! It surpassed the N64 and nearle the SNES and PSP! PS3 and 360's are NOWHERE of that, oh and how many versions of PS3 and 360's out there? 5, 4 different versions. They need lots of versions to sell that much! Noticed how many versions of Wii are there? 1!!! Why are there lots of versions of 360's? Coz they suk! and on top of that, all Core, Arcade, Preimium(20 + 60) and Elite only sold about 25 million units. PS3's got 20,40,60,80 and 160G versions. They struggled because of the price tag, they are not expensive anymore! They sold about 17 million units. The Wii, there is only 1 version of the Wii! Why? Coz it's awesome, everyone knows that the Wii ISN'T FAULTY, that's WHY THERE'S ONLY 1. They sold about more than 40 million units. But, if the Wii had an upgrade with better graphics, and all those good games come to the Wii. The Wii can probably outsell the PS2! But they haven't done it yet, hope they did. I own a PS3 and Wii, and I know the PS3 is better in terms of technology, the Wii can also do anything PS3's can do (Wi-fi, AAC, FREE ONLINE, Pictures, Downloading games to DS, chat, Internet browsing, Card reader) name it!, apart from Blu-Ray and graphics. But in return, PS3's can't do what Wii can do (Better sensing, 12 controller outputs, full backward-compatibility, less electrical consuming, Mii's, Blue-Light, Wireless DS link,etc.) So in terms of popularity and greatness, the Wii beats the PS3 and THRASHES the 360's! So I bet everything that the Wii.... WINS THE 7th Gen wars! Whether YOU LIKE it or hate it!

josetaveras
josetaveras

well i don't think the Wii is the winner because i own all systems and to tell you gusy the true the nintendo wii have more sucky games than the ps3 or xbox360 if you check they don't have great games unless it's mario or zelda and after that THE SYSTEM SUCKS!!!!!!i don't even play my nintendo wii anymore that systems is for little kids... PS3,XBOX360 ROCKS AND THE WII SUCKS!!!!!

twilight-X
twilight-X

I am a wii owner and I thinks it is still to early to call it a win in nintendo's part, this could be turned around by microsoft or sony. the fight goes on ROUND TWO..... FIGHT

dj_b02us
dj_b02us

hey there was a time when nintendo was doing so badly people talked about them exiting the console market and just making games ala sega. or just doing handhelds so im just glad to see them back on top. now get on with a new kid icarus game and kirby game! -_-

hatieshorrer
hatieshorrer

lol, you all sure know how to make me laugh. Heres a challenge for the people claiming the Nintendo Wii is overpriced. Build a Nintendo Wii from the ground up and, dont cheat by modifying a computer or, using spare PC parts on hand. 1)Buy each nintendo Wii part individually and put them to gather to make a Wii. Im sure youll spend between $200.00 and $250.00 2)When you finish remember you didnt have to pay for a)manufacturing and shipping b)Wiimote and nunchuk c)Japanese and international taxes d)software and updates e)wii sports disk f)royalties to stores caring your product (And as for the X360 arcade is $200.00 argument) A computer with a CPU and GPU with as much power will cost over $1000.00 M$ is using cheep parts and under pricing the console software profits make up for the loss and has resulted in a high rate of breakdowns you cheep skate.

Merl57
Merl57

well i see now why they want to keep the price where it was at

Merl57
Merl57

well i see now why they want to keep the price where it was at

puppiemaster
puppiemaster

Nice to see the fanboys out in force for M$ and Sony, Get over it, the Big N is gonna win this generation and we all know it.

Megavideogamer
Megavideogamer

Well Nintendo has somehow managed to almost always earn money. Using outdated Technological Game machines. Remember the Original Game Boy. Using Dot Matrix Black and White display? The Original N.E.S was the least "powerful 8-bit" console. Somehow Nintendo made money with the Nintendo 64 and the GameCube. Nintendo's only real Flop was the Virtual Boy. I had thought that the Nintendo Wii and DS were also going to Fail Badly. Somehow, Nintendo makes money with its "Lesser Than" consoles. The Last "Cool" Console Nintendo made was the Super Nintendo. But Nintendo's Off the wall ideas seen to pay off.

grigjd3
grigjd3

At 35 million consoles, that's 210 millions dollars profit on on 8 and 3 quarters billion total income (roughly) on the consoles. While that seems small, add to that say five bucks per game sold and suggest an average of seven games per console and you get another 1.225 billion dollars. I'm guessing I am low-balling that figure. Nintendo is doing just fine.

enoslives7
enoslives7

the wii is a repackaged gamecube.....nintendo has mountains of unsold gamecubes, so they just yanked the guts out of old gamecubes and made wiis....thats why the wii has such inferior graphics

ocdog45
ocdog45

damm, they are breaking the bank!

blackace
blackace

I think Nintendo definitely makes more then $6 on each system. Maybe that's what they were making at launch, but not anymore, I can tell you that. Forbes knows absolutely NOTHING about gaming or the gaming industry. They need to stick to corporate business and people who make over 10 million a year. Anyways, Forbes figures are a mess, so take what they say with a grain of salt.

daabulls23
daabulls23

Six dollars is more than Sony or Microsoft makes on each of their consoles (I think). Maybe not. Who really knows? Apparently Forbes can't really be trusted with figures anyway.