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Nintendo: “Sales will fail to meet forecast by a large margin”, $336m loss expected

Friday, 17th January 2014 08:00 GMT By Matt Martin

Company slashes global Wii U sales forecast for the business year by almost 70 percent, to 2.8 million units from 9 million, and its 3DS sales forecast to 13.5 million units from 18 million units.

Nintendo has warned it make a full year operating loss of around 35 billion yen ($336m) due to weaker than expected sales of the Wii U and 3DS. It now expects to sell only 2.8 million Wii U units during the fiscal year – down from its 9 million targets, with 3DS sales of 13.5 million rather than 18 million.

“Sales in the U.S. and European markets in which we entered the year-end sales season with a hardware markdown were significantly lower than our original forecasts, with both hardware and software sales experiencing a huge gap from their targets.”

Software projections have also been revised down from 38 million Wii U games to 19 million, and 66 million 3DS games rather than 80 million.

It had originally expected to make a profit of 100 billion yen ($958.2m). It now predicts a net loss of 25 billion yen ($239.5m) rather than a net profit of 55 billion yen (527m) and net sales of 590 billion yen ($5.6bn) instead of the previous forecasts of 920 billion yen ($8.8bn).

It said: “Giving a detailed explanation on our sales performance in and leading up to the year-end sales season by platform, Nintendo 3DS continued to show strong sales in the Japanese market. The unit sales for Nintendo 3DS in the previous calendar year amounted to approximately 4.9 million units, falling short of our aim of five million units by a small margin. However, as I explained before, given that every gaming device from the year 2000 onwards apart from Nintendo DS and Nintendo 3DS did not reach sales of four million units even in their peak years, we can say that the sales figure for Nintendo 3DS in the last calendar year was indeed very high. However, outside Japan, while its market share increased as we continued to release compelling titles throughout the year, Nintendo 3DS did not reach our sales targets in the overseas markets, and we were ultimately unable to achieve our goal of providing a massive sales boost to Nintendo 3DS in the year-end sales season.

“Using the U.S. market as an example, Nintendo 3DS became the top-selling platform in the last calendar year, according to NPD, an independent market research company, with its cumulative sales exceeding 11.5 million units; however, the estimated annual sales of the Nintendo 3DS hardware remain significantly lower than our initial forecast at the beginning of the fiscal year. In Europe, while the individual markets showed different results, France was the only market in which we experienced relatively strong sales, and we failed to attain our initial sales levels by a large margin in other countries.

“Wii U sales, on the other hand, showed some progress in the year-end sales season as we released various compelling titles from the summer onwards, launched hardware bundles at affordable price points and also performed a markdown of the hardware in the U.S. and European markets; however, they fell short of our targeted recovery by a large margin. In particular, sales in the U.S. and European markets in which we entered the year-end sales season with a hardware markdown were significantly lower than our original forecasts, with both hardware and software sales experiencing a huge gap from their targets. In addition, we did not assume at the beginning of the fiscal year that we would perform a markdown for the Wii U hardware in the U.S. and European markets. This was also one of the reasons for lower sales and profit estimates.”

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47 Comments

  1. sithsylar

    http://www.youtube.com/watch?v=YKUOB8MN4Kc

    #1 9 months ago
  2. Ireland Michael

    3DS: This is the equivelant of coming first in the race but complaining you didn’t finish fast enough.

    Wii U: I’m going to feign shock and surprise at this. The sales target was a ridiculous figure from the moment it was announce, and everyone said so.

    Nintendo will almost definitely continue to drag their heels instead of actually doing something about the problem.

    #2 9 months ago
  3. undermyrules

    WiiUtanic lol

    #3 9 months ago
  4. loveaya

    Thank you, Nintendo!

    #4 9 months ago
  5. KAP

    Is Nintendo trying to commit Seppuku?

    #5 9 months ago
  6. Joe Musashi

    I genuinely hope this information puts fire in the bellies of Nintendo’s staff. Have them embrace change, look at new avenues, create new opportunities. It could be a catalyst for unprecedented innovation and revolution in one of the industry’s most revered companies.

    JM

    #6 9 months ago
  7. Sethos

    Sounds like an emergency, Wii U Wii U Wii U Wii U Wii U Wii U.

    #7 9 months ago
  8. mistermogul

    What’s interesting is investors have put Nintendo valued above Sony in recent months, even with this news and the fact PS4 is flying off the shelves.

    Nintendo set themselves up to looking stupid here as nobody in the world other than themselves thought they were going to sell 9 million Wii U’s. The revised 2.8 million figure is where it should have been the whole time. If it was they wouldn’t look so stupid now!

    #8 9 months ago
  9. mistermogul

    @6 – or not.

    You know as well as the rest that Nintendo don’t really do change. Stubborn and stuck in their ways is probably how they’ll remain.

    #9 9 months ago
  10. ArithonUK

    Goes to show that even Mario and Pokemon can’t save you from weak overpriced hardware and undesirable gimmicks.

    Any child who wants portable gaming gets an iPod. Nintendo missed the digital gaming boat and opted for the 3D fad instead. Result; massive losses.

    #10 9 months ago
  11. Fin

    So fucked. I assume Iwata will leave once the forecasts are confirmed?

    Wonder how Francis will try to spin this 8)

    #11 9 months ago
  12. Ireland Michael

    @6 It probably won’t, sadly. They simply don’t know how.

    @10 Mate, the 3DS is the one success story amongst all this.

    #12 9 months ago
  13. matirishhh

    Wii U is a fantastic console. I bought it cheap few months ago just to try it out…and I was actually positively shocked. I hope sales will jump up, because this machine has a great potential. OFF TV play was the biggest selling point for me which woks like a charm. Great games – Super Mario 3d World, Rayman Legends, ZombiU now I’m playing AC4 on it and I love every second of it…not mentioning batman, splinter cell etc. Amazing piece of hardware

    #13 9 months ago
  14. Showmeyomoves!

    @10 Try reading the article before commenting.

    The 3DS is selling like hotcakes. It’s the Wii U that’s the problem.

    #14 9 months ago
  15. Goffee

    At least Nintendo is being honest about this, when Sony actually gives some (any?) honest Vita figures, then we can talk. As an indicator, it only shows the continuing decline of all consoles. Once the core have upgraded to X1 and PS4, expect their sales to plummet too.

    #15 9 months ago
  16. Fin

    @15

    Are you serious? Continuing decline of all consoles? They’ve just said they expect to sell 70% less than they thought.

    The Vita beat Wii U in UK sales last year.

    http://www.eurogamer.net/articles/2014-01-13-xbox-360-was-the-uks-best-selling-home-console-in-2013

    #16 9 months ago
  17. dreamcastnews

    I honestly love the Wii U, it’s no secret here but I’m not clouding the judgment that the console should possibly be discontinued as soon as the 3DS is replaced.

    It’s a real sad day being a Nintendo buyer and a real far cry from where they were half a decade ago.

    I don’t think pulling the U now is the best idea, we will just end up with a Saturn scenario and thus Nintendo’s next machine, how ever great it would be would just suffer the same fate in fear of them pulling the plug.

    I also think they shouldn’t go 3rd party since I agree with Iwata when he says the experiences are catered to the Nintendo hardware, and the two often do work together. I do however feel, that home consoles aren’t the companies bread and butter and should leave Sony and MS to battle it out and stick exclusively in the handheld market where they excel.

    Franchise fatigue is becoming far more of a problem now for Nintendo since they have two mouths to feed rather than one as it should be, Jack of all Trades and all that…..

    Who agrees?

    #17 9 months ago
  18. Ireland Michael

    @17 *raises hand*

    #18 9 months ago
  19. dreamcastnews

    One has to wonder why Ninty didn’t go shopping for developers back in 2008-09 when they were sat on a megaton of money, it’s well documented that although the Wii and DS were still selling good numbers, they were losing momentum, surely a flash of cash getting new developers would have prevented all of this….

    #19 9 months ago
  20. Diingo

    Nintendo’s only knows how to throw more Mario games to make more money…. that strategy is no longer working. They fail to realize that in order to sell a console you need more than just games. Nintendo is seriously stuck back in the 90s businesses mentality. They will only change right before their company collapses to save themselves. They are a very stubborn company.

    #20 9 months ago
  21. melonbuster1

    Sell it without the controller. . Drop the game cube compatibility. Put in the pro controller sell it for 169.99

    #21 9 months ago
  22. salarta

    I just decided to take a look at Nintendo stock. They’ve taken a real dip over the years. Back several years ago when the Wii was popular, they were up at around $70 per share. Now they’re down to about $18 per share.

    #22 9 months ago
  23. dreamcastnews

    @21 that could work, although the console doesn’t play GC games. I hate to think how much R&D funding the Wii U GamePad cost them. I would have happily sacrificed maybe an inch or two from the GamePad for a faster processor unit, that’s for sure.

    #23 9 months ago
  24. mistermogul

    @19 – “One has to wonder why Ninty didn’t go shopping for developers back in 2008-09 when they were sat on a megaton of money”

    Exactly. Surely they knew that HD development for their next console would take more resources? Instead they didn’t act and we’ve had a year of no new games!

    Anyway, they are still sitting on that megaton of money so could still do this. They’re a very cash-rich company, hence why their market cap is relatively high compared to their recent performance, higher than Sony’s even…

    #24 9 months ago
  25. melonbuster1

    Sell the screen controller with preloaded games or market it separately for 89.99. Do what you have to Nintendo. . Because if you let this one fail.. nobody will buy a new Nintendo system. . The game cube failed wii got over because of a gimmick the wiiu people saw that trick already. . Fix it or die

    #25 9 months ago
  26. dreamcastnews

    @24 +1

    @25 I agree, they need to really shift it up a gear, I honestly can’t believe they tried to positively spin the Wii U sales at the end of the statement, but at the same time, they tarred the 3DS with the same brush – that thing is the money maker!

    If there was any chance of 3rd party support this year before now, there certainly isn’t now… No publishing house is going to release retail games now.

    #26 9 months ago
  27. Clupula

    “Once the core have upgraded to X1 and PS4, expect their sales to plummet too.”

    BZZZT! Wrong! If anything the PS4 and XB1 prove that there is no “decline of all consoles.” They are not only selling well, but, most importantly, there’s a whole group of people waiting to upgrade, because maybe they’re happy with their PS3/360′s right now.

    Those people aren’t going away, just waiting for the new systems to be worth the hardware cost. Myself, I never buy a new system until it has 20 exclusives that I must have.

    And many others are waiting for games like Final Fantasy XV and Kingdom Hearts III to come out.

    In short, the future is VERY bright for the PS4 and XB1.

    #27 9 months ago
  28. yeoung

    Nintendo needs a neat idea to get out of this slump. Perhaps a faux-console dockingstation for a next-gen handheld. A beefed up handheld that slides into a docking station for couch play, and can be removed like a cartridge for mobile play.

    I don’t think their strategy of catching up to the last gen at the start of the new gen is going to be viable anymore. Don’t want to see Nintendo go away, but don’t want to have them keep great IPs hostage in hardware solutions that lack capacity and most notably, decent input mechanics. Obviously I’m talking some point down the line, considering the 3DS.

    I jumped ship when the N64 hit, and they never got full support for a practical SNES-like controller back. So very sad. At the very least, I’d like a bundle with a game and a pro-controller for cheapsies, not the current second-screen gamepad. Nintendo has the capital to take a risk or two, but hardcore gamers tend not to forget easy and the massive casual splash that was the Wii was a fluke (as well as adequately marketed).

    #28 9 months ago
  29. dreamcastnews

    @28 I think the GameCube went a great length to try and rectify the problems formed by the Nintendo 64, the pad was lovely and the exclusive games were blinding – 3rd party support let the side down a little with sloppy ports, but again; Nintendo went with Mini DVD rather than industry standard at the time….

    The Wii in some respects was everything the GameCube was conceived to be, how different it could have been if the Wii came out in 2001 with a GC controller with optional motion controls.

    I think honestly though, the N64 got most of this roadmap wrong. Once in a while (like now) Nintendo get caught with their pants down and certainly it happened when the ’64 launched.

    Every company has a console that starts to tip the balance towards lack of customer/ publisher faith, Atari with the 7800, Sega with 32X, SNK with CDZ, Nintendo with N64.

    @27 yes, an HD handheld with a major processor that has a TV processing dock, they’ve touched on the idea with the Wii U console/GamePad combo, hopefully they pick up the scent and get on that when it’s time to re-fresh their handheld.

    #29 9 months ago
  30. OmegaSlayer

    WiiU won’t even sell those 2.8 mil imho.
    Anyway, building a new HD console is not the solution.
    And I don’t know if 3rd party developers/publishers will keep trusting an hardware maker that treats them like crap.

    #30 9 months ago
  31. Blackened Halo

    Wii U needs X!!!! Where is this game??!! :( Release it dammit or Wii U will really sink to the bottom of ocean, next to Titanic …

    https://www.youtube.com/watch?v=APWTJMyM4qg

    #31 9 months ago
  32. Digital Bamboo

    ^Nah, X will only sell to the Xenoblade/Monolith Soft/RPG/hardcore crowd.

    If there’s one game this year that can turn the tide for the Wii U, it’s Mario Kart.

    #32 9 months ago
  33. salarta

    @32: Actually, X IS needed. There are two reasons. One, the “hardcore crowd” you mention needs a reason to trust the company will actually release such games instead of possibly withholding them stateside as the company naerly did with Xenoblade, Last Story and Pandora’s Tower. Two, games like X are prominent examples for the average person that the console DOES have something to offer besides Mario with the rare Zelda, Metroid or Smash Bros.

    It’s silly to suggest that X won’t be much of a help for the company when they have such a big image problem. The fact that Knack outsold Super Mario 3D Land explicitly shows that relying solely on the diehard fanboys and marketing almost exclusively to families outside those diehard fanboys isn’t enough.

    Mario Kart isn’t going to turn things around for the Wii U. There’s a reason this image exists and gets used so much, and it’s not because Nintendo ignoring the wider consumer base is a good idea: http://imgur.com/xmCoOBy

    Unlike Squeenix, Nintendo actually has a chance to fix itself if it starts listening to consumers NOW. If they refuse to do so any longer, they’re heading into a downward slide into failure and ultimately getting bought out.

    #33 9 months ago
  34. Dragon

    As expected. Said this from the start that such pompous sales figures will never matched.

    And sorry, 3DS is also not selling as expected. It has also missed the expectations. It is trailing way below DS. Just shows being handheld only will only be a temporary solution. Dedicated handhelds will die soon at this rate.

    Its a company wide problem and heads need to roll, fast.

    #34 9 months ago
  35. The_Red

    @34
    Rolling of the heads is a change. For that to happen, Nintendo first needs to understand the meaning of the word “Change”. The last time they did so, was around the time of World War 2 (When the last Yamauchi took over the reigns).

    #35 9 months ago
  36. dreamcastnews

    Nintendo’s first party output won’t come quick enough to save it, maybe they could consider putting a Nintendo coder in Ubi Soft, EA, Take 2 etc and cushion the costs of developing/releasing Wii U versions of 3rd party IP.

    This, mixed with a little spending spree of buying upcoming indie houses could certainly help, if not for the Wii U then for the next Nintendo machine.

    #36 9 months ago
  37. Legendaryboss

    @32
    How many games does Wii U need? Cause i swore we went through this last year. Wait for insert exclusive/popular third party game here…

    We already had Mario. We already had a Zelda HD remaster. We already had Monster Hunter 3. We already had The Wonderful 101. We already had Pikmin 3. We already had a price cut. We already had Skylanders/Just Dance. We already had COD/AC, twice. At some point the goalposts will have to stop. A question i have to ask is what exactly were we waiting for? And why should it be different this year?

    Point: At this point the Wii U has lost its momentum and has returned to bombing, and when certain games arrive there will be an uptick in sales but nothing permanent. 3DS is doing fine and will continue selling well.

    #37 9 months ago
  38. absolutezero

    Nothing is going to “save” the WiiU.

    Nothing could save the Gamecube, theres not a title in history that is of such a high quality that it will turn around an entire consoles prospects.

    Its dead.

    Lets dance around its corpse.

    #38 9 months ago
  39. Dragon

    @35,
    Really, just look at Yamauchis history. He tried a BILLION biz opportunities to make Ninty a big company, took retirement after failure of GC.
    Now what does Iwata do? NOTHING!

    #39 9 months ago
  40. The_Red

    @39
    All I’m saying is that this a company BUILT on not changing. Of course they had changes since post World War 2 years. Hell, introduction of NES and Game Boy were pretty bold (And awesome) moves. Sadly, over the years they became more and more stubborn to a degree that right now, you can’t even call them “inside a bubble”. At this point, they’ve reached “under the Dome” status in terms of having a closed development and managerial environment.

    #40 9 months ago
  41. Gekidami

    I cant believe there are still people saying “Game Y will save the WiiU”.
    Have you learned nothing?
    https://i.chzbgr.com/maxW500/7925529088/hF0B5B8B5/

    #41 9 months ago
  42. dreamcastnews

    @41 I think they’re calling it game ‘X’ actually :p lolz

    #42 9 months ago
  43. SplatteredHouse

    @40 That situation is only gonna keep the plates spinning, for as long as they’re winning. Microsoft, Sony, indie uprise, [s]mobiles[/s] Apple/Android, Steam. Nintendo – How many fronts are they being contested from, at once.

    #43 9 months ago
  44. Tyrantsoul

    At this point I really doubt we will see X in the west due to the terrible sales the Wii U is getting.I don’t imagine the Wii U will last long enough in order to complete developing the title.A shame too as it looks amazing.Iwata needs to go and Nintendo need to stop thinking they are still top dogs these days.Sink or swim at this point.

    #44 9 months ago
  45. SplatteredHouse

    When I saw that game, it reminded me of an N64 RPG that either eventually found a limited release, or it was unable to reach the market at all. I joked that it was an interesting choice for a sequel when the video played!
    That RPG kept being put back and little news if any, until I could see it had become almost an injoke found at the bottom of each month’s release list (in, I think it was N64 mag), that one screenshot of its promise-filled expansive green landscape and a brick tower. It got swept away by Nintendo’s ballpoint focus on OOT in the end, I believe.

    #45 9 months ago
  46. antraxsuicide

    The image has already been posted twice. And I agree with it completely. Nothing will save this console. That’s what happens when you burn bridges; you don’t have any friends left to pump funds into the system to help save it.

    EA won’t do it. Activision won’t do it. And Ubisoft is getting fed up with doing it.

    You’ve messed up, Ninty. And I don’t see how you’ll fix it.

    #46 9 months ago
  47. MrWaffles

    Just hire Miley Cyrus as a creative director for Nintendo and watch the money rain once more

    #47 9 months ago

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