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Nintendo sales down, but profit still climbs

  • By Patrick Caldwell, GameSpot
  • Posted May 25, 2006 1:54 pm PT

Decline in GameCube, GBA sales means full-year revenues were off 1.2 percent; net profit still climbs by 12.9 percent. Wii launch will have 6 million units worldwide.

Gamers may have had plenty of Nintendo news to soak up in the recent weeks, but investors want to know one thing--is Nintendo making money? The company answered that question today when it released its results for its recent fiscal year.

For the full year ending March 31, 2006, the company saw a decline of 1.2 percent in total revenues compared to the previous year. The revenue tally for the year was 509.25 billion yen ($4.5 billion).

Due to foreign exchange gains and interest income, however, the company increased its recurring profits by 10.6 percent over last year and saw a 12.5 percent gain in net profit compared with the year before. Net profit for the past year was 98.38 billion yen, or $873 million.

"They basically have a very stable and growing handheld business and it looks like for the first time in 10 years they will actually have a successful console business," Hiroshi Kamide, a game analyst for KBC Securities Japan, told Reuters.

Owners of Nintendo stock made out well, according to Nintendo. It announced the highest annual dividend in Nintendo's history, 390 yen per share ($3.48).

Despite the surge in popularity--and sales--of the Nintendo DS, it fell short of making up for the lack of sales generated by the GameCube and Game Boy Advance. In addition, increased research and development costs for both the DS and Wii dragged down operating profit.

Nintendo is counting on the continued success of its DS handheld and a successful launch of the Wii to increase its worldwide sales by 18 percent this fiscal year, the company said.

In announcing other Wii details, Nintendo added its plans to ship 6 million consoles at launch around the world before the end of its current fiscal year, which ends March 31, 2007. The company is also projecting that 16 million DS handhelds will ship during the current fiscal year.

69 Comments

  • EddyPee

    Posted May 28, 2006 4:42 am GMT

    I played GTA once. It almost bored me to death.

  • princeofgames90

    Posted May 27, 2006 8:23 am GMT

    sow game boy is dead but when wii is out the profits will be more

  • DarkKefka

    Posted May 26, 2006 12:32 pm GMT

    Yeah, the GameCube and the GBA are slowing down Nintendo. Good thing that the Wii is in the near future - means more money for Nintendo.

  • enoslives7

    Posted May 26, 2006 12:27 pm GMT

    the gamecube was a tremendous flop . the wii/gamecube 2 wont do much better. Nintendo should stick to making portable systems.

  • GKBeetle

    Posted May 26, 2006 10:23 am GMT

    FFObsessed-
    "Not a shock that the GC would not be selling when people found out the wii would play the GC games every one will wait for that"

    With tht ridiculous logic, the PS2 wouldnt be selling now would it? Cant you just admit the GC isnt selling due to its lack of decent software? It finished last in the console race for a reason u kno.

    Actually, the main reason that PS2s are selling so well is that they break so often. I never had a problem with my Gamecube or XBOX, or even my Super Nintendo which is still working. Actually, that seems to erase the save files if you accidentally nudge it while playing, but its pretty good considering how old it is. However, I have had 3 Playstation 2 die on me. I replaced 2, and the third still works as a DVD player, but won't play games. I'm probably more likely to buy a new PS2 rather than upgrade to PS3 at this point since the new console will be so expensive. Anyway, I really think that the fact that PS2s break down so often is helping push sales of the system.

  • LordAndrew

    Posted May 26, 2006 10:19 am GMT

    It's amazing how Nintendo manages to make money without selling many games.

  • faridmon

    Posted May 26, 2006 9:03 am GMT

    to those who said the Gamecube is not selling because its crap or something, and ii doesn't ahve good games, i'll say does the Xbox have good games like A YEAR NOW.

    and for this news, am very pleased that nintendo is still making money, but am very sad with the Gamecube, the Gamecube has a terriffic games, in 2004 the games were just amazing, tales of symphonia, paper mario, metroid prime2: echoes, baten kaitos and more, but in 2005 am bit dessipoted how little rtop titles were, it was just fire emblem: path of radince , so i can't really blame the consumers now. But am blaming them in 2004.
    well the DS is still strong and the wii is coming, thats enough for the big N, but i want more Gamecube games, but still legend of zelda twilight princess, baten kaitos oregin and super paper mario will keep my mouth sot intill wii.
    GO NINTENDO.

  • jaefrmbk2k

    Posted May 26, 2006 8:54 am GMT

    where can i find a TRS-80?

  • qiwihead

    Posted May 26, 2006 8:26 am GMT

    Did anyone notice that the very next News story says Nintendo's profits are down 19%? I'd say they better get their story straight--did their profits go up or down?

  • Konfusion

    Posted May 26, 2006 7:26 am GMT

    The high dividents is IMO the most important of all this. If investors are happy, all is well in Nintendo land. Surely the future is looking very bright with Wii around the corner.

  • shizwill03

    Posted May 26, 2006 6:04 am GMT

    Nintendo will be VERY profitable this holiday season, as both the Wii and DS fly off store shelves and people buy up every fricking copy of Zelda and other launch games and accessories.

    The price is between $200-250 bucks, which means that they might not lose as much money per console...but without proper evidence on the cost I can't be sure.

    But they will make up for that with the games and their online service, which will blow Sony and Xbox out the water.

    Nintendo FTW!!!

  • metdevthegamer

    Posted May 26, 2006 5:11 am GMT

    I have no doubt that they will sell out, and unlike Microsoft they'll have consoles ready to sell at launch.

  • chrisdojo

    Posted May 26, 2006 5:06 am GMT

    sweet.

    as for 6 million Wii's for launch...... maybe it will sell out!

  • metdevthegamer

    Posted May 26, 2006 4:54 am GMT

    Good news. Imagine they will get a boat load of profit off of Wii sales.

  • bunty_007

    Posted May 26, 2006 4:36 am GMT

    another Nintendo news ... are they selling Consoles expensive (arguing $ony)

  • pangitako

    Posted May 26, 2006 4:34 am GMT

    nintendo has been in the industry for over 20 years. i think it knows how to play it. for example knowing when HD should be implemented, motion sensing, raw power, online, ect. and thats why i think they're always seen profiting.

  • naruto82us

    Posted May 26, 2006 3:43 am GMT

    keep going Nintendo

  • jonajacket

    Posted May 26, 2006 3:07 am GMT

    Sorry Spaceworlder - If the company had to rely solely on their video game business to keep running, they'd sink like the Titanic

    What other business is Nintendo involved in?

    Even with lower sales than it's competitors, GC sold about 30 million, each of those systems making a profit rather than a loss (like most other consoles)

    That's just perfect business sense

  • alishareef

    Posted May 26, 2006 2:32 am GMT

    the Wii will be like the DS - extremely successful and profitable.
    I predict it will sell more units than the ps3

  • phSychO_AtDawn

    Posted May 25, 2006 10:46 pm GMT

    Nintendo's wii is getting a lot of publicity so theres a way,the future holds Nintendo

  • rbarahona

    Posted May 25, 2006 8:41 pm GMT

    I'm sure that Nintendo will see a rise in sales, both in terms of the Wii and the Nintendo DS. It's a shame that the GCN and the GBA are seeing a decline in sales, but due to the lack of new games and only Zelda to wait they will have to make more bundles in order to get rid of all those GCN.

    I think that Nintendo will see great times ahead, because of the Wii, the DS and the new concepts they are trying to introduce.

  • airdom

    Posted May 25, 2006 8:35 pm GMT

    im telling you guys, nintendo is up to something REAL BIG in the coming years! i just cant wait!!!

  • comthitnuong

    Posted May 25, 2006 7:34 pm GMT

    12 percent is alot

  • spaceworlder

    Posted May 25, 2006 7:08 pm GMT

    You don't seem to get the big idea: Nintendo isn't making money because of their games; they're making money because of investments.

    If the company had to rely solely on their video game business to keep running, they'd sink like the Titanic.

  • duxup

    Posted May 25, 2006 6:48 pm GMT

    You have to respect Nintendo, while the big boys loose money fighting over market share Nintendo just keeps on making money.

  • spaceworlder

    Posted May 25, 2006 6:46 pm GMT

    As usual, Nintendo gets by through their investments rather than their hardware/software.

    The fact that they're using dated hardware for both the Wii and the DS shows how far they've fallen. Building their console with old, cheap technology is the only way they can maintain a stable business.

  • yabbal

    Posted May 25, 2006 6:31 pm GMT

    I work in retail and have already had mum's askin me if we have "the new nintendo one where control the games by moving it?". It seems nintendo's idea of seperating itself from the competitiion and marketing at a broader audience may pay off.

  • seg555

    Posted May 25, 2006 6:02 pm GMT

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

  • captainalpha1

    Posted May 25, 2006 5:50 pm GMT

    Leave it to Nintendo, still going strong

  • NeoJedi

    Posted May 25, 2006 5:35 pm GMT

    I think the sales from the Wii will be much better than those from the GameCube, since the Cube was far from being revolutionnary as the Wii is.

  • alberto2045

    Posted May 25, 2006 5:29 pm GMT

    wow!!!!!!!!!

  • SinisterC

    Posted May 25, 2006 5:23 pm GMT

    Bloodhawk_DX "If the Wii is going to get as repetative and rusty as the Gamecube.."

    So PS2 and XBox aren't repetitive? Maybe it's just me, but every GTA seems the same. PSP and PS2 are basically the same system with the same games, except one dies in three hours.

  • kingofps3

    Posted May 25, 2006 5:18 pm GMT

    6 MILLION. $ 249X Wii 6000000 = $1494000000. money money.

  • marc_man3001

    Posted May 25, 2006 5:11 pm GMT

    w00 long live nintendo O.o

  • IcemanX5

    Posted May 25, 2006 5:06 pm GMT

    Gamescube hasnt been selling because when other consoles went online Nintendo didnt. They have the Broadband add-on but didnt use it and thats what led 3rd parties companies to do great game for the PS2 & Xbox and crappy game for the Cube. Is to bad, I was a big fan of the Cube. I still think the Cube had what it take to keep going but Nintendo ignored it. To bad....Good machine down the toilet.....Not a first

  • EvanO_O

    Posted May 25, 2006 4:24 pm GMT

    I wonder how many copies of mario Party 6 have sold by now...probably millions....

  • win_andrew

    Posted May 25, 2006 4:22 pm GMT

    '-grnidbandit-
    why is nintendo worrying about making money, sounds like they are turning into sony and MS-'

    Er, they're a Business... and like all successful businesses, Nintendo makes money by making and selling great games. If they weren't into making money, they would've gone out of business ages ago. Common sense dude.

  • TacoJelly

    Posted May 25, 2006 4:17 pm GMT

    GC isn't selling now because it wasn't selling well to begin with. If a console doesn't have a good installed base, then no companies have any incentive to work for it... I blame this on the horrible president that preceeded Iwata. GC had a lot of potential in the begining, it just didn't get the right push out into the world.

    But now they have good management, growing popularity, developer support, and a unique console they have all the ingredients to turn this all around.

  • mrgokugf

    Posted May 25, 2006 3:59 pm GMT

    we all know the Gamecube and GBA are well past their prime.......lower sales are to be expected, viva la DS lite and Wii!!!!

  • nacho4511

    Posted May 25, 2006 3:53 pm GMT

    Trust me the wii will change it all

  • T1Sephiroth

    Posted May 25, 2006 3:46 pm GMT

    Glad they did'nt go cheap. This system is "Affordable", not cheap. The low price of the gamecube only helped to hurt it's image, well, that and it's ugly purple launch color. Wii costs less then PSP BASIC

  • Bloodhawk_DX

    Posted May 25, 2006 3:42 pm GMT

    Recliner15
    The Wii will be unstoppable..

    Unstoppable? As long as you don't forever stumble on their -genius- controller the whole time.

    I agree, I can't wait for the new Smash Bros. Of course I can only hope they properly balanace the characters this time around.

  • Recliner15

    Posted May 25, 2006 3:34 pm GMT

    The Wii will be unstoppable..

    Just the thought of playing super smash bros online makes me that much more anxious to pick it up

  • FuguNabe

    Posted May 25, 2006 3:34 pm GMT

    Wow... I respect Nintendo's hustle. They really know business. To gain profit regardless of situation is what I would call smart. They've shown me the definition of 'thinking outside the square'. Kudos to Big N...

  • SystemShock2

    Posted May 25, 2006 3:32 pm GMT

    nintendo's unstoppable.

  • ste90

    Posted May 25, 2006 3:26 pm GMT

    Nintendo are making money Sony if it is now is going to loose quite a bit developing games for the PS3 and the console itself costs tons of money, so i fink in the coming years Nintendo will be the company making the most profits due to the cost to create and develop games for the Wii is less and the console is cheaper so there not loosing any money off the console.
    The ds lite will add even more revenue for Nintendo so i think this year is going to be good as long as the Wii does well and so does the ds lite. And 6 million units sounds pretty good for Wii lets just hope its enough.
    I think in the next gen profit war Nintendo will definately win but if the sales are really really good this will just boost profits because it doesn't cost that much to create the console.
    Nintendo are not going out of the gaming business anytime soon and anyone who says that is a idiot! I think its all on the Wii now for Nintendo because if thats really popular and they can keep the games coming and keep people interested it will be the best console they have had in a long time.

  • Myugenjin

    Posted May 25, 2006 3:18 pm GMT

    Man do any of you understand this article let alone investing, it stated the DS was lacking in sells compared to the GBA and GC meaning thats what's bringing the company down! Plus 12% growth over last year isn't nothing compared to Sony's 64% game division growth & MS's 32-40%.

    Basically for the money they've made out of "$75" in sells they only get to keep like "$19" while MS and Sony are in the mid 30's range. That Hiroshi Kamide analysist is only saying this is the best the company's looked in a long time seeing as how they gave a huge dividend which will only hurt their stock when the investors sell.

    They should've used that $3 a share div. to dev new games 4 the Wii!

  • EddyG0RD0

    Posted May 25, 2006 3:13 pm GMT

    if they dont sale from where the profits?

  • Nostradennis

    Posted May 25, 2006 3:13 pm GMT

    Go Nintendo !

  • ssj4_2004

    Posted May 25, 2006 3:10 pm GMT

    Hey grnidbandit, glad to see Your bashing Nintendo... as always. So hows your PSP treating ya? eh? eh? we all know you hate the DS with A passion...
    --
    This is great news for Nintendo, although I thought they would have more Wii's at launch. I was expect between 7.5 and 8 Million units

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