Nintendo Profits Down 43% - Sales Expectation Lowered

I think that Spong deserve a word of praise on this article. You've managed to give a balanced view of these developments that will no doubt be reported as in much of the gaming press as "Nintendo falls into the abyss".

Nintendo is still a profitable company. Just look at the situation last year where the yen was their main money-related problem, and when it started to weaken their situation improved rapidly.

any bets to guess the exact day that Nintendo goes belly up? I think November 19, 2006

I don't think Nintendo will go belly up in the forseeable future. This is because:
1) It still makes very healthy profits.
2) Nintendo has a large army of investors ready to inject cash into the business.
3) It could always survive by becoming a software-only business.
4) There are lots of rich old men in Japan that would be willing to save Nintendo.
5) There are a lot of companies that would love to purchase Nintendo and it's assets and use them in some form (but keeping Nintendo as a seperate company).
6) If it was really under pressure it could downsize and withdraw into Japan (OK, so it's questionable but possible).

I think that we'll be seeing Nintendo for at least another decade.

Crap. The second Sony entered the ring i could smell death in the air.

Give it 4 years, and there will be no true games comapnies left. Sega and Nintendo will be distant memories, and there'll be consoles by Sony, Microsoft and probably Panasonic. Seeing as the latter already have a Gamecube variant in Japan, i think i can guess where the hardware side of Ninty will go.

Crap. Crap crap crap.

How exactly do you define true games comapnies? Do you mean companies that have been in the games market for a long time, or just the ones that were around when you were bought your first console?

Remember, Nintendo started out as a card game manufacturer and still make collectable card games.
Potted Nintendo History

Sega started life as an export company called Rosen Enterprises and was only called Sega (contraction of Service Games) once it aquired a jukebox manufacturing company.
Potted Sega History

So neither of your true games companies are anything of the sort. They weren't set up to manufacture games consoles, they moved into it after arcades and home gaming became popular. Neither of them even started out manufacturing electronic devices.

At least Sony started out repairing radios and manufacturing electronics.
Potted Sony History

I'm sure in 20 years, people will be moaning about the newcomers in the market that are squeezing real games companies like Sony, Panasonic and Microsoft out of the way.

I think what he was saying as far as "true gaming" companies is concerned is that gaming is thier main business. Microsoft has thier Windows OS and all thier Offcie Suite packages and whatnot. Sony's business is all over from Computers to DVD players and TVs to movie studios.

If Microsoft or Sony's systems go belly up and they get out of the gaming business, there will still be a Microsoft and Sony. If Nintendo's system fails, they will just be a software producer and will eventually be absorbed by another company.

Yeah he ment companies that only focus on games (Nintendo). But I feel if you can't take the heat get out of the kitchen. Atari was unable to advance Nintendo and they lost and I never heard a huge Stupid Nintendo why did you take away the grand daddy of console gaming? Its just Nintendo was the first Mainstream system and people have grown up to think that it is almost a holy company and anyone to say otherwise should be shot.

In reality the company sold some of the most defective systems and everyone turned a blind eye to it. The original system (NES) had terrible connections to the carteriges (very important in 80's gaming), The SNES had many problems with the eject button sticking or not working, then the N64's terrible analog stick that constantly had malfunctions (sticks would get jammed, and wear away quickly). I'm not saying that they were the only company with issues (Sony comes to mind in console making problems) but people love to have a superstar. Nintendo is kind of like a famous 40's actress, We had such great memories with past projects that we allow ourselves to forgive there current bad projects because the memories over power our emotions.

I am a 1st gen gamer (born in 1980 the big boom for games), I grew up with an Atari in my hand. I had many systems growing up even a 3do, yes you read right!.I have to say the 4th gen gamers are very spoiled and almost don't understand gaming. Its not about who has the flashiest graphics or the most deepest gameplay, or even the most replay value. If you played games in my era you would know that gaming was just to have fun, excape reality, and (for me atleast) sharing time with others, those are the things that make gaming wonderful.

What I am trying to say is this, as a kid I rememeber my friends and me would spend the whole day trying to find secrets in Mario 3 and we spent countless hours playing Mario Kart together. Those memories flood when I think of Nintendo and I am sure many of you feel the same way. Unfortunatly they have lost there edge and are becoming a dying brand, we have to mourn the loss and go on with our lives. I for ove mourned greatly with the release of the N64, that was the last system I bought from Nintendo and to this day still feel a hole in my heart when I play games. I want the fun easy to play games of the past but I can't get what I want so SOL for me.

Is it the games, or is it you? Your tastes and susceptibility to being drawn into a gaming world have probably changed since you were 10 or whatever. Surely kids have a better sense of fantasy, and are more inquisitive?



How do you know kids of today aren't doing this with Mario Sunshine?

I don't go in for the whole "in my day games were games". I was there, and they were good at the time. But having played countless 8-bit and 16-bit games through emulators, I've since found the vast majority of them to be absolute s**t.

On the whole, and if you keep an eye on what's available, modern games have evolved into better, more involving experiences. The exceptions we know to stay away from, but even today's bad games are way better than 80's bad games.

IMO, we've never had it better, and modern games aren't missing the "magic" of older game; we're just missing our childhood innocence that created that magic.

I agree with you there (execpt for the 16 bit games=s**t point).

I play modern games and believe that a lot of them are much better than the games of the 80s. Some of the old 80s games, Zelda springs to mind here, are now not even remotely enjoyable.

For example, I enjoy Sunshine as much as Mario World and Prime as much as Super.

There are undoubtably some excellent 16-bit games. But only a handful have aged well, I reckon. Shoot-em-ups tend to, as do the Ninty flagship games.

Examples of games I used to like, and how they've aged:

Well

Mario Kart
All Super Mario's
Super Metroid
Sonic The Hedgehog
EA *shudder* Hockey
Gunstar Heroes
Ghouls 'n Ghosts

Badly

PGA Golf
JAmes Pond: Robocod
Golden Axe
Populous
Road Rash
Pilotwings
Super Star Wars

Who says ninty are going to go belly up. They've STILL posted a profit, which is more than i can say for a certain other console.

Worldwide cube sales are still on par with the xbox.

Just because they're profits are down doesnt mean they're screwed.

Lets look at the facts:

1. The strength of the yen probably had something to do with it.

2. This is quarter 3 of last year.. like when they were getting ready to release the DS... The DS launch wouldnt have been cheap, making games for it, marketting it, etc etc.. And it'll take a while for that to make them any profits back.


I'd expect (guessing) that sonys game divisions profits might have dipped around time of the psp launch as well...

The point is, Ninty and Sega used to be close. It was never a "one company leads, the others fight" deal. Now, Sony are the first company people think of, and the others are just "alternatives". Look at catalogue space; Sony takes up 4 pages of the new catalogues i believe, and i think Nintendo and Microsoft get a page each. Give it 5 years and that will only get bigger. Let's face it, the companies that are doing best are those with fingers in many pies, such as EA.

8-bit games aren't TOTALLY terrible; look at the success of the Namco joysticks, for example. It's just that time has sorted the really good (Pacman, Xevious, Pole Position, Pitfall) from the crap (ET...). The original Mario games, for example, are still damn good, and really hard too. Heck i STILL play Mega Bomberman. It's just now, it plays on my phone. Now, original Game Boy games... erk. It's... bad. REAL bad.

In that case, Nintendo still have a reasonably profitable card games division. If they pulled out of the console hardware market, there would be lay-offs, but they would still produce software and they'd still make card games.


Nintendo would survive, even if they didn't make games for other people's consoles. In the nine months to Dec 31 2004 Nintendo made roughly £8,677,000 outside of their console hardware and software business. They made roughly £946,670,000 from software alone.
Nintendo Financial Reports
(Reports use Yen, I converted the figures using xe.net, see page 6 of the Third Quarter of Fiscal Year ended March 31,2005 report for the breakdown)

Nintendo ain't a pure computer gaming company by any means.

Does the financial report show this? I didn't think their card divisions were doing that well. In the late 1980s they reported that they were considering pulling out of that market. Amazing that these 100 year old cards are still selling.



This is kinda what I meant when I said Nintendo could pull back into Japan. The only way the company could fail would be to rack up amazingly high R&D/production costs on a system that didn't sell anything at all and then for all their shareholds to refuse to finance (let's face it, hardly likely considering Nintendo's potential and those figures).



I think Nintendo is as pure home console company as you'll ever get. That £8 million is a drop in the ocean compared to their hardware and software revenues. Sega were never a pure console company due to massive income from the arcades. The same goes for Namco and the like.