Nintendo posts loss as revenue slides
Nintendo saw its revenue slip 50.2 percent year over year during the company's last-reported quarter, due to slumping hardware and software sales.
Nintendo endured an exceedingly difficult fiscal first quarter, the company announced today.
According to the gaming firm, it generated revenue of 93.9 billion yen ($1.2 billion) during the three-month period ended June 30, down more than 50 percent compared to the same period last year. During the company's first fiscal quarter, Nintendo lost 25.5 billion yen ($328.3 million), which is nearly in-line with the 25.2 billion yen it lost during the same quarter in 2010.
Nintendo was hit hard by slumping demand for its hardware. On the DS side, Nintendo's unit sales hit 1.44 million worldwide, off from the 3.15 million units the company sold during the same period last year. Even worse for Nintendo, it sold just 710,000 3DS units worldwide last quarter, including only 110,000 in the U.S. For the Wii, sales during the quarter were down to 1.56 million units worldwide from the 3.04 million units it sold during the fiscal first quarter last year.
Nintendo seems especially concerned with the 3DS. In addition to announcing its financials, the company today said that it will be dropping the price of the portable to $169.99 on August 12. The device is currently on sale for $249.99 in the U.S.
"For anyone who was on the fence about buying a Nintendo 3DS, this is a huge motivation to buy now," Nintendo of America President Reggie Fils-Aime said in a statement.
But it wasn't just a hardware issue for Nintendo last quarter. During the period, Nintendo DS software sales dropped to 12.1 million units worldwide from the 22.4 million Nintendo tallied during the same period last year. Nintendo's Wii software sales hit 13.4 million units last quarter, down significantly from the 28.1 million units it sold the prior year.
Nintendo's latest showing follows a similarly disappointing end to its last fiscal year ended March 31. During the period, the company generated revenue of $12.32 billion, down 29 percent year over year. It was able to generate a profit of $946.7 million, but that figure was down 66 percent compared to the company's prior fiscal year.
Looking ahead, Nintendo isn't too confident in its ability to turn things around. The company today revised its fiscal-year forecasts down, saying that it expects to generate 900 billion yen ($11.6 billion). It has also pared its profit forecast down to 20 billion yen ($257.4 million).
Update at 5:26 a.m. PTto include more details.