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[Xater]

I don't think the Wii U is salvageable at this point. The GameCube did bad but not as bad and no single title did change it's situation. Also it seems like the profit on each console is worse, if they are not even still losing money on each one. Also looking at their overall losses I am not sure if just rising it out for a couple more years is that viable.

 

[Tookay]

Yeah, but these ones are being enacted, they aren't just sitting as ideas. The R&D building, for example. NERD as well and a variety of other things.

My point is, the "wait and see, they're changing things!" approach you have towards Nintendo's management has been employed for the last 2-3 years and could conceivably extend into the next decade, because of course they're going to be executing lots of changes. They always will. Because they're a business. In a dire spot.

Also, going back to your original post, who cares if internet-goers years from now attribute it to Iwata's successor instead of Iwata himself? I'm sure Iwata has gotten some credit for the DS and Wii's success that was partially sprung from Yamauchi.

The point is, better management wouldn't even have gotten them into a situation where a "wait and see" approach is even necessary. They would have anticipated and enacted plans that dealt with problems before they developed, instead of as they were developing (or even afterwards).

But surely someone who understands the global market rather than one segment is more suited for the top role?

That's a different argument than the one you were just making. Obviously, someone with a complete global understanding would be preferable, but one who's especially in connection with NA tastes would be better than the current insular thinking.

 

[L Thammy]

Nintendo is/was trying to do too much with the amount of employees they have/had. I'm curious to see what their hirings and development between consoles and handhelds getting closer will have on this when the next devices eventually come out.

I think it has more to do with third parties. Video games can't be pumped out in a week anymore. If there's a hole in the schedule, it may be impossible for the company to fill it themselves without sacrificing their quality standard. With the Wii and DS it was assumed that success would bring in the third parties, and it did, but that crowd disappeared eventually. They aren't there for the 3DS or Wii U.

 

[reptilescorpio]

To be fair, I think the 3DS is definitely hurting Wii U. Jane Walmart asks: Why spend $300+ on a Wii U for 3D World and Mario Kart 8 when I can get little Jimmy a 2DS for $130 with 3D Land and Mario Kart 7?

Yeah I've heard this before from a co-worker. Had no idea what the WiiU was meant to be and retorted that there is no reason to buy a WiiU because they already have Mario and Mario Kart on the Wii, so why would they buy a new console to play the same thing again.

 

[cyberheater]

They probably aren't going to lose THAT much money.

Yes. But I don't believe they will have the confidence to understand what the public wants from a home console. They seriously misunderstood that with WiiU.

 

[duckroll]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

 

[kmax]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

"Please understand"

He really needs to turn this ship around or resign, because he's dragging his company down with poor decisions after another.

 

[JoeM86]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

A CEO talking sense.

Just think, if this was a western company, the CEO would have made half the staff redundant by now.

 

[Mihael Mello Keehl]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

Uh oh

 

[liger05]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

And how can that be done? There is no hope for the Wii U now.

 

[Sandfox]

I think it has more to do with third parties. Video games can't be pumped out in a week anymore. If there's a hole in the schedule, it may be impossible for the company to fill it themselves without sacrificing their quality standard. With the Wii and DS it was assumed that success would bring in the third parties, and it did, but that crowd disappeared eventually. They aren't there for the 3DS or Wii U.

I think the 3DS had good enough third party support in its first year but a lot of the games ended up coming late. I think the console 3rd party is the biggest thing causing the droughts and its one of the first thing that needs to be fixed going forward.

And how can that be done? There is no hope for the Wii U now.

He's not saying that he's going to do it through the Wii U.

 

[wsippel]

Holy nintendo tinted glasses batman...

Have you actually used both? Granted, I rarely play online, so my main concerns are things like the shop and the automatic/ background download, install and update facilities, and Nintendo Network is so far ahead in those regards it isn't even funny. I also kinda enjoy Miiverse, as superfluous as it may be. And when I actually play online on Wii U, I don't really miss anything. I have my voice chat, my friends list, my list of people I've recently played with and all that jazz.

 

[L Thammy]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

Almost feel like this is threadworthy in itself: one thread to discuss "should we fire Iwata" and another to discuss "what should Nintendo do from here".

 

[B.O.O.M]

How nice of him lol

 

[MisterHero]

Yeah I've heard this before from a co-worker. Had no idea what the WiiU was meant to be and retorted that there is no reason to buy a WiiU because they already have Mario and Mario Kart on the Wii, so why would they buy a new console to play the same thing again.

Maybe the same reason people bought PS4/XBO and Call of Duty or the next Killzone or Dead Rising. lol

A CEO talking sense.

Just think, if this was a western company, the CEO would have made half the staff redundant by now.

They should be like PS3-era Sony and have mass layoffs /sarcasm

 

[JoeM86]

And how can that be done? There is no hope for the Wii U now.

Just because you can't see it does not mean it's not possible.

 

[cyberheater]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

He's a clown. Unbelievable that he isn't resigning.

 

[BrokenEchelon]

You have it in one. The way people are acting here, the 3DS is bombing, but it isn't. It is doing well in all regions. Best selling hardware in the US, UK, Japan and probably most other places in 2013. It's just Nintendo had ridiculous expectations for it, as they always do.

Nintendo has, this past year, been putting many plans into action, and we won't see the results of them until the end of this year at the very earliest. You can bet that, if the worst does happen, and Iwata is fired and these actions succeed, his successor would suddenly be loved here despite them being Iwata's plan.

Ever the deluded optimist.

Iwata's "plan" is happening as we speak. And whatever his "plan" might be, it's failing. Price cut didn't do much (inflated NPD numbers during the holidays don't mean shit). The Vita is starting to outperform the Wii U in Japan and every major release on it is flopping even relative to the install base of the system.

They fucked this system up on all fronts: The name was idiotic, the marketing was terrible, there wasn't and still isn't a proof a concept game that makes a good case for the WiiPad, the system is egregiously underpowered compared to its rivals which aren't much more expensive, and Nintendo's online infrastructure is still embarrassingly stuck in the early 2000s.

The 3DS exists in a world where it has actual competition in the mobile space. If not from the Vita, then from other devices and it simply will not be able to replicate the success of the DS. It's easy to rule a deserted island, but those days are over.

 

[AzaK]

Right, this is the rock and a hard place of Nintendo's philosophy. The company's biggest strength, as has been since the beginning, is IP recognition and quality. But not everybody wants to play every single IP they produce, as applies to every publisher under the sun. You can be the world's biggest Super Mario Bros. fan and still not give a shit about The Legend of Zelda. Yet everybody is forced to pay the same entry price for their hardware just to play the IPs they're interested in and not much else.

And it's not really an argument for third party, so much as the harsh reality of the situation, and the necessity for Nintendo (if they continue in the home console space) to provide customers with a product they feel they can confidently invest in, one that will meet their budget and long term requirements.

This is me and is why I am so fucking livid they failed to get third party support. I love Zelda and Metroid so I paid my hard earned cash to play essentially 2 games down the line, hoping third party and the odd Nintendo game would hold me through til then. NUP. Now you can say more fool me, and fine, I accept that but what it means is I will no longer purchase Nintendo machines at launch and this generation I'm not going to buy any more games on my Wii U until Zelda and Metroid. I'm now saving for either a Steam Machine or PS4.

He's a clown. Unbelievable that he isn't resigning.

And last year he did well to not outright say he'd resign if they couldn't meet their 100 million(?) yen operating profit, he just hinted at it to keep the dogs at bay.

However, I'm interested to see what this vision is.

 

[liger05]

A CEO talking sense.

Just think, if this was a western company, the CEO would have made half the staff redundant by now.

Please do give examples? I want to see the comparison you talk of.

Just because you can't see it does not mean it's not possible.

Iwata's revised forecast says everything that needs to be said. It's dead.

 

[MarkusRJR]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

So when this plan the reinvigorate Nintendo doesn't work (which seems like the case, since the Wii U seems like a lost cause) is there finally a chance for a new CEO? If so, all I see here is a captain going down with the ship.

 

[GCX]

This will force Nintendo to do something really drastic. Can't wait for the GAF thread when that unfolds.

 

[Xater]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

Lots of people will ask for his head, also like I said Earlier turning the Wii U ship around is almost impossible.

 

[Nekofrog]

"guys, i know i've really fucked everything but, but just bear with me here."

 

[Aquamarine]

Institutional investors who keep their money in Nintendo for the dividends aren't going to be happy that Nintendo projects another bare-minimum 100 yen dividend per share thanks to very poor company performance wiping out any extra dividends granted through performance-based profit successes.

 

[duckroll]

Almost feel like this is threadworthy in itself: one thread to discuss "should we fire Iwata" and another to discuss "what should Nintendo do from here".

I'm not really sure what there is to discuss which hasn't been discussed in all the 50 other "Iwata not resigning" and "Should Iwata be fired" threads. It's all the same thing, there are no new ideas. At some point he will either: turn Nintendo around, be ousted, or give up and resign. There will be a worthwhile discussion if any of that happens. Until then, it's the same status quo.

 

[Sandfox]

Yes. But I don't believe they will have the confidence to understand what the public wants from a home console. They seriously misunderstood that with WiiU.

Hopefully the feedback from the Wii U and market research to prevent this from happen again will put them on the right path.

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

I personally want Iwata gone but I really like this statement.

 

[Haunted]

Horrible numbers. Simply horrible. This misses everyone's most pessimistic expectations for operating income expectations by $400M+ USD and baseline estimates by over $650M+ USD. No one seriously thought they were going to hit $1 B USD in operating profits. Most people were seeing Nintendo hitting 30% of the target as a baseline. That they are expecting a loss for the year of $350M USD is mind-boggling.

Only four things can explain these losses IMHO:

1. Nintendo's gross margins on software must have shrunk dramatically. Meaning that they are barely making any money on their own software much less third party software which has all dramatically dried up on both of their platforms globally. This bodes very badly for Nintendo in general - even if they were able to go third-party and hypothetically sell 2-3X the number of games (which I very much doubt) - what this shows is that Nintendo has lost its pricing power at retail - people aren't ready and willing to pay the Nintendo premium.

2. Nintendo bled money at retail trying to push hardware - far more than anyone expected - they must be eating close to a $100+ loss per Wii U sold right now or more - not just because of manufacturing cost - but because they are literally having to compensate retailers to provide them with shelf space and having to eat the price drop at the same time. This is horrible - because even if they take that much of a loss - the low gross margins on their own first-party games isn't sufficient to help them break even.

3. Nintendo isn't going to get Mario Kart or Smash out by early April - otherwise they would have been able to book orders under the current fiscal year. It looks like both games are going to be delayed well into the summer or into the Fall now. I am almost 100% positive that if it were even possible to get the games out by April or May - Nintendo would have done everything in their power to do so. It looks like Nintendo still hasn't effectively transitioned to HD development - not because of capability - but because they want to preserve gross margin based on their lower expected revenue numbers - and it's compromising their ability to get projects out the door on-time.

4. Nintendo is playing shell games with their accounting - booking contractual payments to Intelligent Systems and their other closely related entities as operating losses for tax purposes but which are effectively asset purchases - it means that they are dramatically restructuring their teams and it's going to be far more expensive than we thought.

If these estimates hold up - Nintendo will have generated a $1 B+ operating loss over the past three years. Here's the kicker though: Nintendo is still sitting on over $1 B+ in inventory that they haven't impaired yet (the IR report makes no mention of it). There is a good chance that over 80% of that is Wii U hardware which means that it's going to continue to be a drag on earnings over the next twelve months.

In any case, I don't foresee any major changes for Q3 happening. Nintendo is still going to engage in a buyback of 5% - which is going to drain their cash by another $1 B USD.

That means in three years Nintendo's war chest will have been depleted close to $2.5 billion USD from inventory impairment, operating losses, and share repurchases. Another $500M USD is going to be gone for asset / real estate purchases and capital investments. Their next hardware projects are going to require about ~$1.5 B USD in capital reserves at a minimum that are going to be tied up in the next two years as they wind down their existing platforms, and I don't see third-party licensing revenue coming back in a big way to offset declining gross margins on their first-party software.

Basically that means Nintendo could burn through ~$4 B in cash throughout this entire cycle and in anticipation of the next, with a very high cost structure intact. Like Sony, they will have effectively wiped out cumulative years of profit.

If we assume that Nintendo keeps building up human resources this coming year to meet their hiring targets, they are probably going to break-even in terms of operating profit for the next fiscal year or make a slight profit - but I'm even second guessing my own ability to understand Nintendo's gross margins now - someone at NOA or NOE is effectively writing giant checks to retailers to keep the channel alive - and that's really not good at all - Apple was in this same position in the late 90s and had to create their own retail stores to stop bleeding money to major retailers. Nintendo isn't going to have the investor support to launch a giant retail project in the US and EU, particularly when they no longer have proven pricing power which would be the primary argument to go that route.

Difficult time to be a Nintendo shareholder.

 

[JoeM86]

Lots of people will ask for his head, also like I said Earlier turning the Wii U ship around is almost impossible.

People said the same for the 3DS

 

[Nags]

If Valve and Nintendo merged it would kill console gaming. It would be beautiful.

Nintendo games with DRM. I'm sure the fans will love em for that.

 

[A_Gorilla]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

Its all just talk. The same as his "please understand" BS. I'm wondering, could the investors/board of directors/anyone FORCE him to resign?

 

[mysterj]

I didn't realize 3DS is in trouble.

 

[fredrancour]

Nintendo games with DRM. I'm sure the fans will love em for that.

Fans worship valve despite the drm.

 

[JDSN]

Im sure things will pick up after the Japanese-centric Iwata becomes more involved with NoA, maybe use Next Level games to make assets and port games when no one else is available.

 

[batteryLeakage]

Right, this is the rock and a hard place of Nintendo's philosophy. The company's biggest strength, as has been since the beginning, is IP recognition and quality. But not everybody wants to play every single IP they produce, as applies to every publisher under the sun. You can be the world's biggest Super Mario Bros. fan and still not give a shit about The Legend of Zelda. Yet everybody is forced to pay the same entry price for their hardware just to play the IPs they're interested in and not much else.

And it's not really an argument for third party, so much as the harsh reality of the situation, and the necessity for Nintendo (if they continue in the home console space) to provide customers with a product they feel they can confidently invest in, one that will meet their budget and long term requirements.

I think that it is kind of funny that Nintendo always talks about the fact that they make hardware to add value to their software, when for me it is the opposite. In their most recent hardware cycles, the hardware hasn't been particularly exciting but a barrier to the games. And I'm sure everybody has wondered what Retro Studios games could look like on recent hardware at some point.

 

[Daingurse]

.

Holy shit, that was enlightening and grim . . .

 

[thepotatoman]

I'm sick of people screaming "fire Iwata" left and right without saying anything about who should replace him. And I'm very curios who could take his place, because I can't think of anybody who would cut his paycheck multiple times and refuse to fire people for the sake of the company. I'm also quite sure nobody with his background and knowledge would step up to lead such a huge company. It's a huge deal and people here think it's so easy.

I really do like Iwata as a person, but those paycuts basically account for nothing to investors, and rigid anti-firing and anti-layoff policies actually hurt the investors. Unless you're a nintendo employee, both those facts honestly mean nothing. If you want to live in a fairer world like that, go to the government to fight for equality and worker rights of everyone, don't just hope for a CEO on the other side of the world to keep his job dispute poor performance to fix what's wrong with the system.

And I wouldn't worry too much about Iwata himself, he's been a CEO of a huge company for a decade. I'm sure he'll land on his feat.

As for who should take his place, most of us aren't exactly immersed in the Japanese business climate to know the names of qualified people available for the job. It's not like anyone knew who Iwata was back when he was just doing corporate planning. But that doesn't mean we can't see when it's time for change.

 

[Radec]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

"Please understand that I am responsible why our company is being labelled doomed even after selling the most console last gen and have the best selling handheld.

I'm not gonna resign though lol"

 

[GCX]

People said the same for the 3DS

WiiU situation is not comparable to 3DS.

 

[Suzzopher]

The year of Luigi has not gone to plan

 

[NingenJanai]

http://www.nikkei.com/article/DGXNASHD1700Y_X10C14A1000000/

Iwata was quoted at the press conference today saying that he feels responsibility for the poor business performance at Nintendo, and he is sorry to all shareholders. He says the most important thing is to revigorate Nintendo's business as quickly as possible. He will NOT resign, but stay in office to carry that through.

He wants to go down with the ship as any good captain should do. /s

 

[BGBW]

Maybe he feels he needs to find the paddle for shit creek first before handing the boat over.

 

[Sandfox]

"Please understand that I am responsible why our company is being labelled doomed even after selling the most console last gen and have the best selling handheld.

I'm not gonna resign though lol"

Nintendo has been "doomed" since before Iwata was CEO.

 

[MisterHero]

"guys, i know i've really fucked everything but, but just bear with me here."

Why not? They did with Kaz and they're still in more dire situation.

 

[Triggerhappytel]

I'm one as well and I seriously hate Nintendo's attitude as I'm sure you know by now at some point the CEO needs to step down to show he's taking the blame. Now, maybe Iwata has a real plan unlike the fantasy they seem to have lived in the last two years so I'm keen to see what he says after the next financials. However if all he wants to do is stay the current course then I think there needs to be a change seriously looked at. I have no idea who I'd want to replace him but I'd like to hear candidates vision for the company.

As you say, we get no votes but it sucks that I'd get more value by wiping my arse with my stocks than selling them now.

I agree with you. He's made a lot of mistakes and needs to change, but I'm not sure right now firing him and finding a new CEO would be the best course of action for them. What he needs to do is map out a very clear two or three year plan for the company as to how to return to relevancy or profitability, and for God's sake invest in some new projects and developers. I seriously think they need more projects which will appeal to a Western audience, and build bridges with more Western studios. For instance, I'd like to see an action-adventure with a new character from, say, Starbreeze, maybe a first-person adventure (not with an emphasis on shooting) from Digital Extremes and a third-person RPG from Obsidian. Just throwing a few ideas out there; they can make games which appeal more to a Western audience without just being about shooting.

 

[Tom Nook Sawyer]

Man that really puts me down today seriously I always thought that the "war chest" was about 10 Billion USD and Nintendo would be fine but its really down to 2.5?

I'm pretty sure (though I could be mistaken) he was saying that it's been depleted by 2.5 billion, and not to 2.5 billion.

 

[liger05]

Its all just talk. The same as his "please understand" BS. I'm wondering, could the investors/board of directors/anyone FORCE him to resign?

Reminds of a football manager who’s team is losing every week but he refuses to resign telling the world how he will see the job through and get past such difficulties.

Iwata just keeps kicking the can down the road.

I agree with you. He's made a lot of mistakes and needs to change, but I'm not sure right now firing him and finding a new CEO would be the best course of action for them. What he needs to do is map out a very clear two or three year plan for the company as to how to return to relevancy or profitability, and for God's sake invest in some new projects and developers. I seriously think they need more projects which will appeal to a Western audience, and build bridges with more Western studios.

This won’t happen under Iwata.

 

[Ushojax]

The biggest mistake Nintendo has made in recent years was not expanding during the height of Wii's success. If they had scaled up their development capabilities back then they could have avoided the software droughts that have damaged 3DS and Wii U, instead they kept everything in the warchest and their teams just couldn't make the games quick enough.

Combined with the 'it's ready when it's ready' mantra it ended up being a disaster. Nintendo as a company is incredibly conservative and it's unlikely that they would have done too much different with another CEO, the board would be the same old farts, but certainly Iwata has to accept some responsibility. He has acknowledged the software drought issue countless times but 4 console launches later and it's still happening. They're doing the expansion now but it's coming far too late to save the Wii U.

 

[geek_box12]

It's all over Iwata.

 

[A_Gorilla]

People said the same for the 3DS

What turned around the 3DS was a price drop and the release of AAA titles. The Wii U has also had both those things happen and sales still have not improved.