Nintendo ekes out a small profit, despite Wii U's drag

The game company says that the Wii U had a "negative impact" on its financials during the six months just ended, due mainly to sluggish sales and a price reduction that cut into margins.

Nintendo

Sales of Nintendo's Wii U have jumped a bit lately, but the device is still proving to be a thorn in the game company's side.

During the six-month period ended September 30, Nintendo generated revenue of 196.6 billion yen ($2.011 billion), down from 201 billion yen during the same period last year. The company was able to post a 600 million yen ($6.14 million) profit, however, which was far better than the 28 billion yen loss it posted in the prior year.

The data Nintendo revealed Wednesday also highlights a surprisingly fast fall from prominence. Four years ago, during the six-month period ended September 2009, Nintendo generated 548 billion yen in revenue and posted a 69.5 billion yen profit.

Part of the problem for Nintendo was its Wii U. The company notes in its financials on Wednesday that the "hardware still has a negative impact on Nintendo's profits, owning mainly to its markdown in the United States and Europe."

"For 'Wii U,' we attempt to concentrate on proactively releasing key first-party titles towards the coming year in order to regain momentum for the platform," Nintendo said in an attempt to reassure investors.

The console's sales figures, however, might cause concern among some investors. Nintendo sold just 460,000 Wii U units worldwide during the six-month period. Nintendo sold 6.3 million Wii U software units. In comparison, Nintendo sold 470,000 Wii units worldwide and 15 million software units.

Still, Nintendo believes that things are going to get better. The company today issued its fiscal-year forecast, and indicated that sales will jump 45 percent year over year to 920 billion yen. Its net income will rise 675 percent to 55 billion yen, Nintendo said.

About the author

Don Reisinger is a technology columnist who has covered everything from HDTVs to computers to Flowbee Haircut Systems. Besides his work with CNET, Don's work has been featured in a variety of other publications including PC World and a host of Ziff-Davis publications.

 

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