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[metalslimer]

Correct, that's the forecast until the end of March. In theory they could miss it.

And based on Nintendo's recent history they will miss both of these.

I'm not talking about investors, I'm talking about going bankrupt. People are acting like the sky is falling. I definitely mixed up their short term assets, but the point still stands: 8billion/.25= 32 years. Obviously they're not just going to do nothing, and no one expects them too. I was just trying to give some context to what $250 million means to Nintendo.

You can still be in terrible shape and not be close to going bankrupt

 

[Colby]

Does this deficit consider R&D costs? For example, if a panicked Nintendo has been hard at work on a Wii U successor due to the cataclysmic failure of the Wii U, would the R&D costs associated with that next-gen development show up in their numbers? Not that I'm suggesting this is the case...I'm just curious.

 

[AniHawk]

I think it's that combined with the fear that if they start putting games on phones then people may get the feeling that all of their games will be released on phones and just stop buying their systems and software altogether. But I don't think that'd happen. We've seen Japanese third parties putting their old games on phones for a long time now and their mainline console and handheld offering still sell a lot. They seem to just view it the same way I do, as a way to make a lot of money with little effort while they continue to make the newer games for handhelds and consoles.

It's something that in the grand scheme of things will only be beneficial to them. And there's a chance that it may even draw people to their platforms instead of away. Create an account system for the 3DS, Wii U, and mobile where buying a single copy of Super Mario Bros. will allow you to play it on all three platforms. So, they may have a situation where someone buys some of their games to play on their phone when they're away from home, but picks up a Wii U to play it when they are home as well as a way to play the newer entries of those games.

nintendo doesn't seem the type of company to do a service, but i think that's a good compromise. my guess is if they try again next gen, they'll do something toylike instead of building something of a steam service that can be played on multiple hardware.

 

[The Grim Heaper]

Holy shit. Big changes absolutely need to come.

 

[Triggerhappytel]

There are few words to describe how horrible this is.

There are even fewer to describe how obvious it was that the Wii U wouldn't sell close to nine million units this fiscal year. They *must* have known this.

 

[wrowa]

People who want Iwata to be replaced with a more "international" and "progressive" CEO ignore that Nintendo's management - and probably almost everyone in a meaningful position - is really, really conservative (and also really old). A new CEO like that would probably be deemed to fail for that reason alone. What Nintendo would need is a complete rethinking or replacement of the whole management -- and that is not going to happen.

 

[JABEE]

And when I say milk the WiiU, I mean milk it dry. Just slowly discontinue it. I know that term is often used when people are talking about products or business that have at least some consumer appeal.

 

[And_Gignac]

If Nintendo wants to sail the dark waves of Wii U awful sales they desperately NEED to release a control less Wii U.

 

[fredrancour]

Gamepad free sku without new software would do very little. The current software lineup is as much of a problem as the hardware and online wasteland.

There are even fewer to describe how obvious it was that the Wii U wouldn't sell close to nine million units this fiscal year. They *must* have known this.

I guess they wanted to bluff their way through the holidays and then revise, rather than either drop to a low but realistic estimate right away, or repeatedly drop a little bit at a time.

 

[Seiru]

That's a big loss.

Who takes the blame?

Well, you see,

with the exchange rate of the Yen,

 

[Crayolan]

I don't want to see Iwata go but....this may be it for him.
At the very least we can expect some big changes this year. Hopefully for the better.

 

[Sakura]

The Wii U's fate was sealed at e3 2013 when it was revealed that Kingdom Hearts 3 and Final Fantasy XV would be skipping Wii U in favor of the PS4 and even the Xbox One. How do you secure Kingdom Hearts 3D for your handheld, but not KH3, which was arguably the most hyped up game reveal since Zelda Twilight Princess. If I was Iwata, I would be trying to fund down ports of those key titles which are definitely going to be commercial darlings. You don't need all 3rd Party support, Nintendo. Just the ones that matter most. But, again, it's too late.

My Wii U will be used for Smash Bros, Mario Kart, and whatever other quirky games they deliver, until the next gen. But I feel like Sony has already won my time and attention.

Er I really don't think that was a big blow to Nintendo.

 

[Bumhead]

Do people realize how much money this actually is, or are they being thrown off by the billions being tossed around? 550mil to (250) mil is big, but it's not even close to the end of the world for Nintendo. They could lose that much for decades upon decades and still be fine. Pretty sure their war chest is $20 billion+.

No.

This isn't how business works and it isn't how the world works.

Nintendo aren't just going to sit there and ignore these losses on the basis of "hey it's not so bad, we have a $20b war chest!". Or they shouldn't anyway. Businesses don't just sit and absorb losses like these until the war chest runs out and one day they're fucked.

Dropping your forecasts like this is majorly significant and majorly bad news. There has to be some sort of corporate level reaction to this.

 

[shink]

Very curious to see how they get out of this. Will they continue with lightning in a bottle or actually learn something from their mistakes and take notice of the market.

 

[ffdgh]

If Nintendo wants to sail the dark waves of Wii U awful sales they desperately NEED to release a control less Wii U.

There are problems with this but at this point, I wonder are they considering it...

 

[Hiltz]

They'll probably begin and end by asking for his resignation.

I really want them to ask some tough questions cause Iwata obviously needs a reality check. Nintendo, pop a hole out of that bubble you live in!

 

[RagnarokX]

On one hand I'm worried that choosing someone with an American business perspective (like Reggie) will compromise some of the company's core values.

On the other those core values are actively inhibiting the console from succeeding elsewhere.

It's a double edged sword. The things that people want Nintendo to do that would make them "more popular" would more than likely make them not Nintendo anymore. A big part of why Nintendo's games are so good is because they don't chase the trends everyone else chases.

 

[Version 3.0]

I don't see any way out of this mess for Nintendo other than finding a partner. The most obvious one, and the only one that would send their stock skyrocketing, is Apple. But I have a hard time imagining that partnership not being terrible, both from a game quality and long-term profit standpoint.

The best possible partner would be Sony. Drop the Wii U and make PS4 games. Sony drops the Vita and leaves portables for Nintendo. Not a 3rd-party relationship, a partnership. Would be amazing. Unfortunately, they'd both probably rather die.

Outside of that...Amazon? Microsoft? I don't know, but they either need a co-branded machine or an exclusive software partnership. Going mobile will kill them faster than sticking to their guns, and going 3rd party will begin a long slide into irrelevance.

 

[Mihael Mello Keehl]

The Wii U's fate was sealed at e3 2013 when it was revealed that Kingdom Hearts 3 and Final Fantasy XV would be skipping Wii U in favor of the PS4 and even the Xbox One. How do you secure Kingdom Hearts 3D for your handheld, but not KH3, which was arguably the most hyped up game reveal since Zelda Twilight Princess. If I was Iwata, I would be trying to fund down ports of those key titles which are definitely going to be commercial darlings. You don't need all 3rd Party support, Nintendo. Just the ones that matter most. But, again, it's too late.

My Wii U will be used for Smash Bros, Mario Kart, and whatever other quirky games they deliver, until the next gen. But I feel like Sony has already won my time and attention.

Ive read your nomura threads before lol

 

[Sandfox]

I'm curious to see where Nintendo goes for here and I hope they don't go extremely western like some people want.

This is just incomprehensible to me looking from the outside. So not only did the Wii U lose money to the tune of 25 billion yen, but at the same time it would have had to wipe out every profit from the 3DS all its software and Wii U software. Either Nintendo are ramping up development on a new system or Wii U is losing way more money than we ever thought.

You're assuming that all the loses are coming for the Wii U and most of it probably is but they are probably spending money elsewhere.

I really want them to ask some tough questions cause Iwata obviously needs a reality check. Nintendo, pop a hole out of that bubble you live in!

I'm sure Iwata is smart enough to where he doesn't need a reality check.

 

[JordanN]

People who want Iwata to be replaced with a more "international" and "progressive" CEO ignore that Nintendo's management - and probably almost everyone in a meaningful position - is really, really conservative (and also really old). A new CEO like that would probably be deemed to fail for that reason alone. What Nintendo would need is a complete rethinking or replacement of the whole management -- and that is not going to happen.

So Nintendo's going to die then? You can't keep making systems that are devoid of all third party support and have 10 year old policies forever.

 

[Htown]

hoo boy

this will not end well

 

[cafemomo]

Er I really don't think that was a big blow to Nintendo.

FF & KH would do tons better on Nintendo hardware than MS.

Having FF and KH on the WiiU might of actually helped the damn thing. Too bad the WiiU couldn't support DirectX

 

[royalan]

Soooo...is now a bad time to get a Wii U? Is it even going to be relevant anymore?

Honestly, at this point I'll be surprised if Nintendo gives the Wii U more than rudimentary support after this year. Panic Nintendo = Super Cheapass Nintendo, as we have learned. Gamecube was already labeled a failure and in the beginning stages of abandonment internally at this point, and it wasn't doing nearly this bad. It would be silly to think that Nintendo isn't going to start pinching pennies harder than they already are at this point.

My guess? Expect all major projects far along in the pipeline to be rushed to market. Expect any major games not far along in development to be put on pause/moved to the successor console. Expect Nintendo to focus all of their efforts on flooding the system with the absolute cheapest, quickest software they can shovel onto the Wii U from here on out.

 

[Aizu_Itsuko]

Wow.

I'm saying that a lot today.

So they are finally past the denial step/finally admitting it? Good. You can't fix something if you insist it isn't broken.

Let's see the reactions from investors now. Big changes ahead.

 

[Phatmac]

I think Nintenfo will have to start seling older games on the mobile market. It's clear that the Virtual Console just isn't cutting it. They need big changes of staff and the mindshare by letting NA be more involved. They have to act like Sony and try to get as many indie devs as possible to provide more games on their consoles. They have to change in order to survive the future. They also can't abandon the Wii U or else they'll lose support from the hardcore. Stick it out and develop something great. But first the culture of Nintendo has to adapt or else they won't survive.

 

[SwiftDeath]

What is the Wii U's WW LTD?

 

[The Abominable Snowman]

I wonder if Nintendo are thinking about bringing in outside talent and focus into their group.

Maybe a Sega/Sammy/Nintendo supergroup could steer this thing back.

 

[metalslimer]

I'm curious to see where Nintendo goes for here and I hope they don't go extremely western like some people want.



You're assuming that all the loses are coming for the Wii U and most of it probably is but they are probably spending money elsewhere.

Well yes they are developing software and new hardware for the future, but surely there would have still been a very good profit if not for the Wii U.

 

[DXB-KNIGHT]

 

[Chindogg]

Wow.

Just wow.

When's the next investor's meeting? I wonder what Nintendo will do.

Edit: What's with people actively laughing at this? It's never good when a console from the big three bombs like this.

 

[Cheerilee]

N64
96/97 - 5.80 million
97/98 - 9.42 million
98/99 - 7.86 million
99/00 - 6.49 million
00/01 - 2.85 million
01/02 - 0.50 million

Total - 32.92 million

GameCube
01/02 - 3.80 million
02/03 - 5.76 million
03/04 - 5.02 million
04/05 - 3.92 million
05/06 - 2.35 million
06/07 - 0.73 million
07/08 - 0.16 million

Total - 21.74 million

Wii U
12/13 - 3.45 million
13/14 - 2.80 million?

 

[JABEE]

Are you serious? A logical argument might be Nintendo catering more to the western market or producing more western developed games, but equating rare as the lone answer to this dilemma is ludicrous. Asinine really.

Their main problem is a much bigger issue than your resolution attempts to solve.

Same with saying Kingdom Hearts being announced for PS4 and Xbox One. This issue appears to be one that has existed for awhile.

 

[Randolph Freelander]

I'm not talking about investors, I'm talking about going bankrupt. People are acting like the sky is falling. I definitely mixed up their short term assets, but the point still stands: 8billion/.25= 32 years. Obviously they're not just going to do nothing, and no one expects them too. I was just trying to give some context to what $250 million means to Nintendo.

Newsflash: The sky at Nintendo is falling. Their console business has cratered. The handheld business is in severe decline. This will be 3 consecutive years of operating losses, and shareholders are losing a tremendous amount of value in the form of lost dividends and a share price that has tumbled significantly since 2007 and will only fall farther based on these projections. They will only take so much before revolting. Nintendo itself might never go bankrupt, although I think you do not fully grasp how fast they can burn through their cash, it's not only via profit and loss that those funds evaporate, there is also internal reinvestment. But Nintendo will not exist as we know them without a significant turnaround.

 

[vinnygambini]

Neither do I.

Investors are going to be furious if Iwata says little other than "We're staying the course. Please understand."

Correct. How can Nintendo accumulate such heavy losses with abenomics at the forefront? I'm at a loss of words.

 

[mackaveli]

No.

This isn't how business works and it isn't how the world works.

Nintendo aren't just going to sit there and ignore these losses on the basis of "hey it's not so bad, we have a $20b war chest!". Or they shouldn't anyway. Businesses don't just sit and absorb losses like these until the war chest runs out and one day they're fucked.

Dropping your forecasts like this is majorly significant and majorly bad news. There has to be some sort of corporate level reaction to this.

Agreed. I understand they have a lot of cash on hand etc., but no investor / company want's to sit by and keep losing profit every year if that is the new trend in Nintendo's business.

Nintendo can be financially healthy but might have to change / shake up their business strategy going forward. Who knows what Nintendo will look like in a couple of years.

They could just become a software company if the hardware business for Wii U is looking bleak and they don't want to release a new console and change strategy.

Yes, they have a ton of cash but if they can't forecast profitability or increase sales in the next fiscal years they will have to change up their plan.

 

[liger05]

Somebody demand changes. This cannot continue.

 

[AHA-Lambda]

The Wii U's fate was sealed at e3 2013 when it was revealed that Kingdom Hearts 3 and Final Fantasy XV would be skipping Wii U in favor of the PS4 and even the Xbox One. How do you secure Kingdom Hearts 3D for your handheld, but not KH3, which was arguably the most hyped up game reveal since Zelda Twilight Princess. If I was Iwata, I would be trying to fund down ports of those key titles which are definitely going to be commercial darlings. You don't need all 3rd Party support, Nintendo. Just the ones that matter most. But, again, it's too late.

My Wii U will be used for Smash Bros, Mario Kart, and whatever other quirky games they deliver, until the next gen. But I feel like Sony has already won my time and attention.

not sure if serious

 

[Deleted member 17706]

Jesus... to think that the 3DS's peak was last year. That's depressing.

I really hope Nintendo has some really awesome new hardware to announce next year that will get people excited. 3D, underpowered, and expensive certainly wasn't it.

 

[SolarPowered]

It really makes no sense to drop the Wii U with only a year after it's release. They need to recoup as much as they can from it and if anything start a new gen earlier or even all together head in another direction.

That being said this is fucked to lower your forecast so much. Or just another way of making it seem positive by saying "hey we beat our forecast"! Things DESPERATELY need to change instead of the mantra "software drives install base". That is true, but there is even a bigger issue at hand preventing the Wii U from succeeding. They simply can't rely on their Nintendo first party games anymore no matter how amazing they are. I love my Wii U, but this performance has been pathetic.

There will be nothing to "recoup" after Smash, Mario Kart and Zelda U. Barring the odd miracle breakout the vast majority of titles will sell below expectations. You can already see this with just about all of Nintendo's first party software compared to previous entries. I'm sure I'll be wrong about Pikmin or something, but my point stands.

 

[EatChildren]

RRRRRRRRROOOOOOOOOAWWWWWWWWWWWWWWRRRRRRRRRR BBBPPPTTTTSCHHHHHGGGRRRRRRRRRRRRRRRRRRRRR

Unsurprising in the slightest, and investors wont be happy. Not sure how they're going to respond. Wait for Mario Kart/Smash wont cut it, but this is Nintendo.

 

[Sakura]

FF & KH would do tons better on Nintendo hardware than MS.

Having FF and KH on the WiiU might of actually helped the damn thing. Too bad the WiiU couldn't support DirectX

But even if FFXV and KH3 came out for the Wii U, that would be like, 2015/2016 at the earliest we are talking. I don't see how it would help the Wii U's situation last year and until the games come out. Spending money to secure those games on your system when for all you know your system won't even by on the market by the time KH3 comes out in 2020 makes very little sense to me, so I fail to see how those games being on XBO and PS4 sealed Wii U's fate as the user said.

 

[tarheel91]

And based on Nintendo's recent history they will miss both of these.


You can still be in terrible shape and not be close to going bankrupt

The hyperbole in this thread is amazing. This is a very minor loss if you look at Nintendo's yearly income history and its magnitude, and yet the sky is falling. No one's arguing they're doing well, but they're not doing terribly either, just poorly.

 

[Ashodin]

This is all just a feint so that investors will be pleased and amazed once the Wii U actually does sell 9 million by the end of the FY.

Iwata is playing four dimensional chess here.

The only way to win is to try to play to match, not beat, your opponent.

 

[Aizu_Itsuko]

The Wii U's fate was sealed at e3 2013 when it was revealed that Kingdom Hearts 3 and Final Fantasy XV would be skipping Wii U in favor of the PS4 and even the Xbox One.

No, that's just the symptom not the cause.

It's a trainwreck of bad decisions.

 

[gigantor21]

So they haven't even SOLD/SHIPPED 2.8m Wii-Us? O_O!

As incredible as it sounds, yes. I suspect they went with as low a number as possible to make sure that wouldn't happen. But considering how they were returning the damn things in Europe last quarter, I'm not ruling out the possibility.

But seriously though. Holy fucking shit, that's just brutal. Between that and the huge drop in expectations for the 3DS, there's no way to spin this--even as a "short term pain, long term gain" type deal. The investors are going to have their knives out over this.

 

[Zalman]

RRRRRRRRROOOOOOOOOAWWWWWWWWWWWWWWRRRRRRRRRR BBBPPPTTTTSCHHHHHGGGRRRRRRRRRRRRRRRRRRRRR

Unsurprising in the slightest, and investors wont be happy. Not sure how they're going to respond. Wait for Mario Kart/Smash wont cut it, but this is Nintendo.

"Mario Kart is delayed. Please understand."

 

[NolbertoS]

N64
96/97 - 5.80 million
97/98 - 9.42 million
98/99 - 7.86 million
99/00 - 6.49 million
00/01 - 2.85 million
01/02 - 0.50 million

Total - 32.92 million

GameCube
01/02 - 3.80 million
02/03 - 5.76 million
03/04 - 5.02 million
04/05 - 3.92 million
05/06 - 2.35 million
06/07 - 0.73 million
07/08 - 0.16 million

Total - 21.74 million

Wii U
12/13 - 3.45 million
13/14 - 2.80 million?

I don't see Wii numbers?? Please include them.

 

[ghst]

Buy off Cerny!

He made a powerful box that didn't cost an arm & a leg.

Make him an offer he cant refuse.

is cerny going to drive them to the AMD outlet so they can pick an APU off the shelf too?

the problem for nintendo is that the only path that really seems open to them (utilising a newer architecture than their rival to provide a streamlined core experience with slightly more power for a lower price) has gamecube stamped all over it.

there's no way they can compete as an full fat next gen ecosystem, they just don't have the infrastructure to stage that kind of endeavour. maybe there's some modern strain of "i just want games, not all that bullshit that consoles push on you these days" ouya fever that nintendo can tap into, but it seems like a gamble no investor would want to take after seeing the ouya turn out to be as desirable as a barbed wire condom.

if nothing else, the wii u proved that nintendo's first party alone can't sell consoles.

 

[zero_suit]

The hyperbole in this thread is amazing. This is a very minor loss if you look at Nintendo's yearly income history and its magnitude, and yet the sky is falling. No one's arguing they're doing well, but they're not doing terribly either, just poorly.

PS3 lost, what, over $5 billion?