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Nintendo posts rare quarterly loss as sales sink over 25%

By Tor Thorsen, GameSpotPosted Jul 29, 2010 2:12 am PT

After nearly four years of profits, the Mario Factory posts a rare $288.3 million loss; Wii sales near 74 million, DS tops 132 million; Super Mario Galaxy 2 goes quadruple platinum.

Ever since the Wii launched in November 2006, Nintendo has posted quarterly profit after quarterly profit.

No longer.

For the three months ending June 30, 2010, the company reported a rare loss of 25.2 billion yen ($288.3 million), versus a profit of 42.3 billion yen ($484.8 million) the year prior. Net revenues were 188.6 billion yen ($2.16 billion), a 25.6 percent decrease from the year before.

Super Mario Galaxy 2's 4 million in sales was a bright spot in Nintendo's dismal April-June quarter.

In a supplemental statement, Nintendo said that the reason for the decrease was falling sales of DS hardware and DS and Wii software. The strengthening yen was also a major factor, since it decreased the value of the Kyoto, Japan-based game giant's prodigious overseas income, which accounts for 86.5 percent of its overall sales. As a result, the company estimated its foreign exchange losses were 70.5 billion yen ($808 million), eating up most of its profits and pushing its ledgers into the red.

Contrary to many analyst reports, the company said global sales of its Wii hardware actually increased during the three-month period to 3.04 million, with 28.17 million Wii games purchased. The console has now sold 73.97 million units worldwide, far ahead of its rivals the PlayStation 3 and Xbox 360, with some 165 million Wii games sold as of June 30, 2010.

The DS has now eclipsed 132 million units of hardware sold, with a whopping 740.93 million DS games sold internationally as of the end of June. However, Nintendo said "fewer new software titles contributed to driving hardware sales," so just 3.15 million members of the DS suite of portables were sold April-June period, along with 22.42 million games.

Nintendo also offered updates on some of its latest software releases. Super Mario Galaxy 2, which launched in North America on May 23, has now sold over 4.09 million units. The game was enthusiastically embraced by review outlets, including GameSpot, which gave the game a perfect score of 10.

208 Comments

  • kirtar34

    Posted Aug 30, 2010 7:31 pm PT

    I'm not a businessman in any sense, so the numbers don't mean that much to me. I'd imagine if anything is causing Nintendo to have a loss, it'd be from people salivating at the 3DS and saving their pennies. And in regards to Nintendo not catering to adult fans: okay, so they don't have any games where the lead character tears off someone's head with his bear hands and I haven't seen any of their games cover the entire screen with gore, but that doesn't mean Mario and Zelda aren't for adults. Doesn't the requirement for bloodshed seem a little... juvenile? I'm a little bored with the standard storyline "you've been hurt or offended to some random degree; seek revenge on those bastards by blowing their heads off." Really, I just want to enjoy a game that reminds me of my roots back in the early 90's. Enter Nintendo. They haven't forgotten where they've come from and what made gaming great to begin with. If anything, they're staying true to themselves. If you want to rip some guys throat out with as much realism as possible, I have no comment. Just don't start bashing Nintendo for it. 'Cuz deep down, we all have some fond childhood memory from the SNES.

  • MasterJosh47

    Posted Aug 12, 2010 10:00 am PT

    see that is the reason i dont buy a wii nintendo doesnt have any good games for adults thats why i got a ds for rated E games like pokemon mario cart and zelda and a xbox 360 for grown up games cant wait for the 3ds though

  • super600

    Posted Aug 9, 2010 5:41 pm PT

    I think nintendo's developing something secret or their using money to develop the 3DS. I hope the 3DS and the secret thing their developing destroys these haters hatred. Nintendo at least tries to make games fun unlike Activision. Nintendo also doesn't backstab their workers when they make a deal with them.

  • itsTolkien_time

    Posted Aug 6, 2010 3:51 pm PT

    Tylendal ought to be correct. With SMG2 turning 4 million and an expected level of Wii sales it is unlikely such a significant loss could be reported without Nintendo placing a lot of investment into the development of something.

  • Flint247

    Posted Aug 3, 2010 3:40 pm PT

    I don't get why people hate Nintendo for re-releasing the same franchises. If people love them, why in the world would you stop making them? Especially if you are making a LOT of money for them?

    If Nintendo suddenly stopped making Mario, Zelda, Star Fox, etc games, people would throw a fit and you know it.

    It's only when companies continue a franchise that's been rehashed many times with no drastic change at all that makes things repetitive and annoying. But Nintendo knows how to keep their franchises fresh and enjoyable.

    But, let the haters hate and stress themselves out, the rest of us will be enjoying Nintendo's success.

  • kavadias1981

    Posted Aug 3, 2010 2:27 pm PT

    Regarding the comments moaning about Ninty releasing the same franchised games over again; think about it from a business standpoint. They sell in their millions everytime. They are financially successful, popular and receive very positive reviews across the board. Why shouldn't they continue to milk it? Do you think Capcom would keep releasing Streetfighter games if they weren't hugely popular? The same goes for Square with Final Fantasy? Koei with Dynasty Warriors? Activision with CoD? If it sells then hell yeah you milk the fudge out of it until it bites the bullet. It is called good business.

  • Ganados0

    Posted Aug 3, 2010 6:07 am PT

    Move and Kinect are mere peripherals doomed to failure while Wii and DS feature unique interfaces as standard.
    PS3 and 360 gamers only have sequels to games they just got to look forward to while Nintendo have invested in making Metroid Other M and Zelda Skyward Sword unique games.
    Nintendo's in it's own league, Sony and Microsoft who dont like second and third place will testify this too -- especially Sony who quote: "really have no competition this gen and therefore win."

  • Tylendal

    Posted Aug 2, 2010 8:40 pm PT

    Reading over some of the comments on this article remind me why I stopped posting on the forums. Some people just have no idea how business works. Personally, my thoughts, reading this, are that Nintendo is obviously spending a lot of money on developing something.

  • Flint247

    Posted Aug 2, 2010 4:51 pm PT

    Oh well, haters will be haters...

    Good thing, Nintendo doesn't listen to them.

  • chimpmeister

    Posted Aug 2, 2010 1:49 pm PT

    @zskrabs24

    Couldn't agree more. Nintendo has aging outdated hardware, on both the handheld market and the console market, and they just keep rehashing the same old junk (Mario, Zelda, Metroid, etc.). Nothing new, nothing original, nothing adult oriented, just a bunch of gimmicks (DS revised like 5 times with useless 2nd screen, terribly designed Wii console with low-resolution and retarded motion controls, etc.). RIP Nintendo, your time is finally coming to an end . . . you can only milk the market so much.

  • Flint247

    Posted Aug 2, 2010 12:32 pm PT

    @zskrabs24

    "I can't stand it to see people say that Nintendo's E3 was amazing when absolutely ZERO games caught my interest."

    We have an opinion, that's why. If no game caught your attention, that's fine. I haven't found many PS3 games interesting, yet, I don't flip out or stress over people who like games I don't care for. That's why we all have different tastes. No one is the same.

    I disagree with most of your paragraph.

  • 64-bit

    Posted Aug 2, 2010 2:35 am PT

    same period for other competition is even more losses. as simple as that.

  • Serious

    Posted Aug 1, 2010 12:23 am PT

    I do believe that the introduction of PS Move and to a lesser extent the Kinect have hurt Nintendo's Wii sales.These two items have been revealed since 2009 E3. Many potential buyers are waiting to see which console to get. Another item that has hurt them is their own 3DS.Why get a DSi now when the 3DS is coming out in less than a year. A friend of mine was going to get a DSi this summer but now decided to wait.

  • monson21502

    Posted Jul 31, 2010 11:53 pm PT

    @leach112, the wii is fun for the first few months. but once you see that you can sit down and bowl/pitch by making a litle arm jester and get the same results as if you stood up made the real life acts. it really takes the fun out of it imo. this will be why kinect wins the motion wars. sony`s move wil suffer the same thing and will be forgotten by its buyers in a few months. with kinect every game or match will be new and fresh as you will use your whole body. i think japan will go nuts for this. dance central will be number one on these charts when it launches. you can bet the house on it...

  • zskrabs24

    Posted Jul 31, 2010 9:46 pm PT

    None of the games that any nintendo lover say on here change my opinion of the system. I do not really classify any wii game to be in the "hardcore gaming" realm. i am an adult. i want to play adult oriented games. Mario is not adult oriented. Zelda is barely adult oriented. the action is stylized and cartoony. Punch-out is too cartoonish and immature. Maybe 3 games in total bring adult oriented gameplay to the wii and they are more than likely multi platform. I can't stand it to see people say that Nintendo's E3 was amazing when absolutely ZERO games caught my interest. Maybe Goldeneye, but i've out grown PS2 level graphics. I spent plenty of time in the generation already, why would i want to go back when the 360 and ps3 bring amazing graphics to life on even crappy games nowadays. and now with the prospect of 3D gaming, i see no reason to take a generational leap BACKWARDS to play games that would be a million times better without the hardware limitations that the wii brings. i know this post is completely off topic from this article but so is everyone elses comment so i feel like i am in the clear. I have great respect for nintendo. my first system was a SNES and i love that system, however, as i have grown older, nintendo hasn't. they have stopped catering to the generation of people that were with them from the beginning and now they have forgotten about us older gamers and now moved on to the younger generation. i feel betrayed and forgotten by nintendo.

  • lordallanon

    Posted Jul 31, 2010 5:22 pm PT

    WIN

  • Takeno456

    Posted Jul 31, 2010 1:51 pm PT

    Wow so this batch of comments is almost the same as the ones about the rise in Sony sales article. I swear every time a sales report gets put on this site people go crazy. Like I said in the other article the way people react to financial reports on this site is strangely similar to Wall Street workers.

  • gabsponge

    Posted Jul 31, 2010 8:18 am PT

    @killip
    seriously, I couldn't agree more.

  • kavadias1981

    Posted Jul 31, 2010 6:16 am PT

    Nothing lasts forever but Iwata is a clever CEO who knows exactly how to adapt the business to keep Nintendo successful. Returning to the hardcore gamer is exactly what Ninty needed to do and we have the 3DS and a great lineup of Wii and DS games to look forward to (in my opinion of course). I look forward to feeding Nintendo some more of my money.

  • gamermanps2 posted Jul 31, 2010 5:30 am PT (does not meet display criteria. sign in to show)

    gamermanps2

    Posted Jul 31, 2010 5:30 am PT (hide)

    I knew nintendo were dying but I didn't know it would start this soon. Move and kinect aren't even out yet.

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