Nintendo Financials -- 'company ups profit estimate'

[Acert93]

If I require 100 of my units of x to be sold to reach my goal, but tell the public that it is my target to sell 50 - does it make my situation all the better if I manage to sell 60?

So, based on the above analogy, you are saying Nintendo really wanted to sell 10M units, so they projected 5M? :? So, as in your above analagy, even though they sold 6M it is far short of their real goal of 10M? :?

I believe for stockholder reasons they are supposed to give realistic estimates. It is not like Sony made a 1M estimate for PSP and intentionally missed. Like Teasy said NDS not only beat estimates, it did very well in a historical perspective. Looking at Nintendo's "situation" so to speak, I would have to say they have done very well. NDS sold better than I personally thought it would and they are making a great profit right now. So I am not sure how your comments apply. Mind to explain?

*hint*

I do not get it, what is the hint?

 

[PC-Engine]

If I require 100 of my units of x to be sold to reach my goal, but tell the public that it is my target to sell 50 - does it make my situation all the better if I manage to sell 60?

*hint*

Nintendo actually has the production capacity to reach 10 million units?

*hint*

 

[Li Mu Bai]

Okay, here's the current financial status. The aggregate sum of all profits and losses, Nintendo's retained earnings as of Dec 31, 2004 stands at 1,130,286,000,000 yen or $10 billion. Including $7 billion+ in liquid cash & reserves. Around the 1st of the year they upped their R&D & advertising 36%, but this was to foster DS development & advertising. Nintendo also increased capital spending 76% to four billion yen, ($37 million) partly for increased DS production.

This new profit forecast of $757.4 million I will put into comparison & perspective with the market leader Sony:

Q1 = 27M loss
Q2 = 102,000 loss
Q3 = 433M profit
----------------------
406M profit YTD

For Nintendo's size, the profits they post are indeed astounding.

 

[Shifty Geezer]

Nintendo are in Softare. Software is very profitable, as MS shows! Sony are in electronics which is not profitable, plus lots of other areas which aren't too profitable.

If you want to get rich, get into software (or oil, if you live in Dubai...)

 

[Li Mu Bai]

Nintendo are in Softare. Software is very profitable, as MS shows! Sony are in electronics which is not profitable, plus lots of other areas which aren't too profitable.

If you want to get rich, get into software (or oil, if you live in Dubai...)

What I posted Shifty were the profits & losses solely from Sony's gaming division.

 

[Carl B]

What I posted Shifty were the profits & losses solely from Sony's gaming division.

I'm surprised at those losses - what was going on at the time? Also where were you able to find the seperate gaming division financials? In the past I have only been able to find the combined Sony group information.

 

[Shifty Geezer]

If you want to get rich, get into software (or oil, if you live in Dubai...)

What I posted Shifty were the profits & losses solely from Sony's gaming division.

Okay, but there's still a difference in my mind between Nintendo and Sony, in that Nintendo write their own software, Sony doesn't. Nintendo make a lot more money from each game sold on GC than Sony do on PS games sold, where they only get the license. The difference is one between a 'selling software' model and a 'hardware+licensing' model. EA too are more profitable than Nintendo, being all software, no hardware. The greater into the software realm you go, the higher profitability you have access to.

Regards the losses, any ideas why? What were Sony doing to cost so much? At a guess, PSP stuff?

 

[PC-Engine]

Actually SONY does create software, unless you think games like GT4, J&D, ICO, Ghost Hunter, The Getaway, SOCOM, KZ, etc. are hardware.

 

[Acert93]

Actually SONY does create software, unless you think games like GT4, J&D, ICO, Ghost Hunter, The Getaway, etc. are hardware.

That is what I was thinking. Nintendo, however they do it, are able to keep turning a profit. Their franchises are very strong among their fans and they have enough fingers in enough pies that their profits stay high. While I am sure Nintendo would like to be #1 in installed base (that would mean their software sold even more units and more licensing fees), but if they can make more money than Sony/MS and not be #1 what is the point of being #1? That is rhetorical as there are a lot of benefits and security of being dominant in your business, but if Nintendo can continue on a path of profitability that exceeds that of Sony/MS even if they are not the market leader, then at the end of the day they will be happy and their investors happy.

But Nintendo will get no love on a forum of hard core gamers

 

[one]

EA too are more profitable than Nintendo

EA is bigger than Nintendo in the aggregate now, but not more profitable IIRC.

 

[Shifty Geezer]

one : didn't EA make several billion last year?

PC-Engine : of course Sony make software, but not on the scale (and appeal) of Nintendo AFAIK. By writing popular games, something Nintendo is best at, they make lots of money. Sony skills don't lie in the same software field, and they don't make as much money. Fundamentally, Nintendo is software company with other bits, Sony is a hardware company with some software dabbles. Or do you see it differently? Do you think software isn't the reason Nintendo is profitable?

 

[wazoo]

one : didn't EA make several billion last year?

You confuse profits and revenues.

Nintendo, SCE and EA are all pretty much equal in term of profits.

 

[TEXAN]

100% of the profits that Nintendo announces comes from their handheld business. Not a penny comes from consoles- their gamecube business.

 

[London Geezer]

one : didn't EA make several billion last year?

PC-Engine : of course Sony make software, but not on the scale (and appeal) of Nintendo AFAIK. By writing popular games, something Nintendo is best at, they make lots of money. Sony skills don't lie in the same software field, and they don't make as much money. Fundamentally, Nintendo is software company with other bits, Sony is a hardware company with some software dabbles. Or do you see it differently? Do you think software isn't the reason Nintendo is profitable?

I tend to disagree, Sony puts out a LOT of games, either first or second party, and they also publish some third party games. A lot more than Nintendo does AFAIK. Talking about quantity here.

 

[Acert93]

100% of the profits that Nintendo announces comes from their handheld business. Not a penny comes from consoles- their gamecube business.

Got some facts to back this up

 

[Evil_Cloud]

100% of the profits that Nintendo announces comes from their handheld business. Not a penny comes from consoles- their gamecube business.

Sure, let us deny Nintendo has been making money on sold GameCube hardware, let us deny the fact that Nintendo has had numerous first party GameCube games which sold very well and made a BIG profit, and base our arguments on nothing! Even better, why don't we pretend Nintendo doesn't exist!? That way, we can come up with anything!

 

[Qroach]

Sure, let us deny Nintendo has been making money on sold GameCube hardware,

Who is in denial here? the people that think nintendo always made money on the hardware or the people that think nintendo didn't always make money on the hardware?

I can tell you for certain that nintendo didn't always make money ont he gamecube hardware. More recently the last price drop to 99 bucks was below nintendo's costs. try looking it up and find the proof for yourself.

I dont' typically agree with texan as he's a pure fantoy, but he isn't totally wrong here.

 

[Evil_Cloud]

Sure, let us deny Nintendo has been making money on sold GameCube hardware,

Who is in denial here? the people that think nintendo always made money on the hardware or the people that think nintendo didn't always make money on the hardware?

I can tell you for certain that nintendo didn't always make money ont he gamecube hardware. More recently the last price drop to 99 bucks was below nintendo's costs. try looking it up and find the proof for yourself.

I dont' typically agree with texan as he's a pure fantoy, but he isn't totally wrong here.

I didn't say Nintendo made profit on every GameCube sold, did I? I am well aware that Nintendo's $/€99 GameCube pricedrop was a carefully thought out plan to increase the userbase drasticly and sell more software, at the cost of some losses on each sold GameCube, which would later turn into profits when production costs dropped.

 

[gurgi]

I'm not sure the $99 pricedrop is that significant in the shadow of MS' 3-4 billion in losses just to pull the same userbase out of its bank account.

 

[Carl B]

100% of the profits that Nintendo announces comes from their handheld business. Not a penny comes from consoles- their gamecube business.

Everything I have heard indicates that the console business is profitable for Ninteno as well, ad it's not just the handhelds. Granted, then again I don't have any hard sources (though I'm going to look later today), but I have a feeling you don't either and are just basically pulling things out of the air.