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[DCharlie]

With these numbers Iwata will have no choice but to spill some news at tomorrow's briefing to calm investors and boost confidence in the company's future. Looking forward to it.

they don't have to do anything - the last thing they want to look like is that they are over-reactionary and that they are being forced off-plan.

I will say however that i fully expect a 3DS XL announcement in this financial year - though i expected this before today.

It's Nintendo's potential get-out-of-dodge card. A larger unit, with the added control, that links up to the Wii U (value add item), better battery life and - the important part- at a price tag that either reduces the losses on the 3DS or out and out makes each unit profitable.

3DS will slowly be choked.

 

[Smiles and Cries]

wow at loses

 

[jman2050]

How much more could the yen appreciate from here?

 

[ryūkotsusei]

I've found this early today

What does -0 even mean?

 

[Hero]

2 million lowered forecast for the 3DS isn't so bad considering they're missing some Q1 games. At least the 3DS picked up and this year should be looking better.

Sucks that they lose so much from the strength of the yen. Is it not feasible for them to keep their foreign assets where they are?

 

[Gamer @ Heart]

Will the DS still have enough left in the tank to surpass the PS2 in the next year?

They still have so much room to drop the price, so i think so. That library is insane. Software wise, i doubt it unless they do extensive re launch/ best of campaigns of all their ever greens.

 

[ZoddGutts]

While Apple destroyed earning forecast expectations.

 

[trinest]

Nintendo always lowers its expectations and expects loss all the time- so when it does good everyones like "OMFG".

 

[Jonnyram]

They revised 3DS down to 14M, so they still have 2.5M to sell in the last quarter to reach that.
Considering it's traditionally a slow quarter, I think this basically confirms a revised 3DS before FY end.

 

[farnham]

nintendoomed+going-4th-party.gif

 

[bigtroyjon]

So in the last 9 months, the Nintendo "warchest" has dropped by by 246Billion Yen, which is about $3.17 Billion(-30%). The odds of them taking any kind of serious loss on WiiU hardware is close to zero, they just can't really afford to burn through a whole lot more cash.

One other thing, the Yen/Dollar rate doesn't really hurt them at all. It's all the Euro decline which is resulting in lower revenue due to currency. They earned about the same amount of Dollars as they spent over the last 9 months, so the $/yen exchange rate is meaningless to sales. (although it makes cash balances held in dollars look worse on the balance sheet)

 

[specialguy]

So is the $623 million loss for the quarter or the 9 months of the fiscal year so far?

These financial things are always so confusing. I hate how some companies report quarterly results and others seem to only report YTD results and you have to somehow work out the quarterly numbers yourself.

 

[antonz]

While Apple destroyed earning forecast expectations.

Im sure if Nintendo could convince millions of people to pay 500 dollars for the 3DS and 2000 for the Wii U that they would set the earning forecast charts on fire too

 

[MatthewB92]

With these numbers Iwata will have no choice but to spill some news at tomorrow's briefing to calm investors and boost confidence in the company's future. Looking forward to it.

Wait tomorrow? Thought it was today

 

[Gamer @ Heart]

So in the last 9 months, the Nintendo "warchest" has dropped by by 246Billion Yen, which is about $3.17 Billion(-30%). The odds of them taking any kind of serious loss on WiiU hardware is close to zero, they just can't really afford to burn through a whole lot more cash.

One other thing, the Yen/Dollar rate doesn't really hurt them at all. It's all the Euro decline which is resulting in lower revenue due to currency. They earned about the same amount of Dollars as they spent over the last 9 months, so the $/yen exchange rate is meaningless to sales. (although it makes cash balances held in dollars look worse on the balance sheet)

Did anyone really expect them to take a serious loss on Wii U? Like PS3 level? I dont think so. I doubt they refuse to take at least some loss on the system in order to maintain momentum and avoid what happened to them last year though. The war chest allows them to take risks, and fucking up the launch of the machine that will drive their profits for the next 5 years by asking for to much dough again, seems unlikely.

 

[guek]

So is the $623 million loss for the quarter or the 9 months of the fiscal year so far?

These financial things are always so confusing. I hate how some companies report quarterly results and others seem to only report YTD results and you have to somehow work out the quarterly numbers yourself.

9 months ending in 2011

 

[SomeDude]

roughly $7.3 billion in cash if my conversion is correct

I thought I remember reading somewhere is was 10 billion.

 

[bigtroyjon]

They revised 3DS down to 14M, so they still have 2.5M to sell in the last quarter to reach that.
Considering it's traditionally a slow quarter, I think this basically confirms a revised 3DS before FY end.

They'll get 2.5 no problem. A revised 3DS and they wouldn't have had to lower the forecast.

So is the $623 million loss for the quarter or the 9 months of the fiscal year so far?

These financial things are always so confusing. I hate how some companies report quarterly results and others seem to only report YTD results and you have to somehow work out the quarterly numbers yourself.

Nintendo always does FYTD in their earnings, so it's for the last 9 months.

Did anyone really expect them to take a serious loss on Wii U? Like PS3 level? I dont think so. I doubt they refuse to take at least some loss on the system in order to maintain momentum and avoid what happened to them last year though. The war chest allows them to take risks, and fucking up the launch of the machine that will drive their profits for the next 5 years by asking for to much dough again, seems unlikely.

Of course not PS3 level but really any loss would be surprising at this point. They are paying out dividends despite the FY loss, they need to make a profit next year. They might lose a little bit of money on the hardware itself but if they do that I think they will cut way back on their shipment targets for launch period. They can't afford another 3DS situation where they are cutting the price on a product that has filled up their warehouses.

 

[Concept17]

Those software sales on Wii... what a drop.

 

[guek]

I thought I remember reading somewhere is was 10 billion.

They have 566,759 million yen in cash and deposits which is about 7.3 billion. Their total current assets including investments and inventories is about 15 billion.

 

[starship]

So for the three months ended Dec. 2011:

Net sales - 340,428 (million Yen)

Operating Income - 40,938 (million Yen)

Net Income - 21,922 (million Yen)

Not bad at all if you look at the last 3 months results.

 

[bigtroyjon]

I thought I remember reading somewhere is was 10 billion.

.

So in the last 9 months, the Nintendo "warchest" has dropped by 246Billion Yen, which is about $3.17 Billion(-30%)

They have 566,759 million yen in cash and deposits which is about 7.3 billion. Their total current assets including investments and inventories is about 15 billion.

Got to factor in the liabilities if you are going to look at it like that.

 

[Dalthien]

They revised 3DS down to 14M, so they still have 2.5M to sell in the last quarter to reach that.
Considering it's traditionally a slow quarter, I think this basically confirms a revised 3DS before FY end.

I wouldn't think so. 16M always seemed extremely aggressive, but 14M seems within reach. That's about 850k per major territory, or about 285k per month per territory (and Japan will already be ~ 500k for January, so Japan seems within reach of 850k). Certainly not a gimme overall, but it doesn't seem highly improbable either.

 

[specialguy]

So for the three months ended Dec. 2011:

Net sales - 340,428 (million Yen)

Operating Income - 40,938 (million Yen)

Net Income - 21,922 (million Yen)

Not bad at all if you look at the last 3 months results.

So they profited ~$200m the last quarter?

I mean not so great considering how Nintendo probably counts on holiday to make 90% of their profits since they're so family oriented, but still.

 

[SomeDude]

.




Got to factor in the liabilities if you are going to look at it like that.

Why the dramatic drop? wii u and 3ds r&d?

 

[antonz]

I wouldn't think so. 16M always seemed extremely aggressive, but 14M seems within reach. That's about 850k per major territory, or about 285k per month per territory (and Japan will already be ~ 500k for January, so Japan seems within reach of 850k). Certainly not a gimme overall, but it doesn't seem highly improbable either.

and I am sure any deficit will be met with shipments so they will meet 14 million. They just realized it would be stupid to hold to 16 and be forced to ship out 2 million extra units into the channels

 

[guek]

.

Got to factor in the liabilities if you are going to look at it like that.

Ah, I don't know much about this kind of stuff. Assets don't automatically subtract liabilities?

In any case, they do still have $7.3 billion in pure cash, or am I not understanding that correctly?

 

[Dreamwriter]

Are these shipped figures? 3DS already past 15 million? Whoa!

Nintendo doesn't do shipped figures for hardware - they don't need to, they've had an electronic registration system at store checkout for years. They know the moment any system is sold.

 

[The Abominable Snowman]

Those are actually great sales, but something about this smacks of bad business leadership.

 

[Ignis Fatuus]

So in the last 9 months, the Nintendo "warchest" has dropped by by 246Billion Yen, which is about $3.17 Billion(-30%).

Wait, where does this number come from?

 

[Miles X]

So Wii shipped 10.3m in 2011 and 360 shipped 15m?

Wow, role reversal or what

 

[Burai]

Im sure if Nintendo could convince millions of people to pay 500 dollars for the 3DS and 2000 for the Wii U that they would set the earning forecast charts on fire too

You mean if Nintendo could get people to pay a premium for high-margin desirable technology?

Exactly like they did with the DS and Wii?

You talk like it's a joke but that's exactly Nintendo's business plan. Problem is the 3DS wasn't desirable enough at $250.

 

[electroplankton]

Bad results, indeed.
This is a legacy of the previous quarters, characterized by an underperformance of the 3DS + too much high expectations + Wii almost dead.
I am confident in the company's future; 3DS started to sell pretty well in all territories, even more than some expectations (e.g. Japan) and they have a new console by the end of the year.
Clearly you cannot cancel out a not particularly strong year by wiping the slate clean, so these results come quite expected.

 

[starship]

So they profited ~$200m the last quarter?

I mean not so great considering how Nintendo probably counts on holiday to make 90% of their profits since they're so family oriented, but still.

That's net income. Operating income is about $530m and it's not bad at all considering they are in a transition period.

 

[AzaK]

So Wii shipped 10.3m in 2011 and 360 shipped 15m?

Wow, role reversal or what

Yup, except the former is almost dead, the the latter is having a second wind.

 

[fabricated backlash]

So Wii shipped 10.3m in 2011 and 360 shipped 15m?

Wow, role reversal or what

Yeah, it was bound to happen. Given how long people have been predicting the Wii to die off, it's amazing it lasted so long, especially with the poor ass software support of last year and Microsoft going all out with Kinect.

Still, selling that much, that late into the life cycle with basically no hit software outside of a few titles is quite remarkable.

Nintendo must've been drunk with success that they didn't see this decline coming, as evidenced by their hubris launching the 3DS without an agressive AD campaign or substantial software lineup.

They still have the option to cut the price on Wii substantially, and I expect them to do so at or before E3. 99€ with Mario Kart or Zelda bundled, and the storage will be empty in time for the Wii U launch.

Yup, except the former is almost dead, the the latter is having a second wind.

For another year or two, but it would take other numbers to really get past the Wii on Worldwide sales, and given that Microsoft is releasing a new console in 2013 I expect numbers to fall slightly in 2012.

 

[fabricated backlash]

Sorry Doublepost.

 

[A less bigoted Deku]

Ah, I don't know much about this kind of stuff. Assets don't automatically subtract liabilities?

In any case, they do still have $7.3 billion in pure cash, or am I not understanding that correctly?

Liquid assets are 917,662 million yen cash+short term investments which is probably t-bills and euro denominated assets. Thats. 11.8 billion dollars.

For comparison, Liquid assets and cash was 886,519 million yen ending Oct 2011 (Q2) or 11.4 billion dollars with the current exchange rates.

Their cash pile and investments is up in the past 3 months.

The YOY drop in cash reserves is likely due to the costs associated with launching the 3DS and the price cut.

 

[JJConrad]

What does -0 even mean?

I really don't know. Based on where they appear, they could be a marginal number of returns.

For those interested, Nintendo has a Historical Data page that includes that sheet above, their income data, and # of software releases as both .PDF or Excel files.

They revised 3DS down to 14M, so they still have 2.5M to sell in the last quarter to reach that.
Considering it's traditionally a slow quarter, I think this basically confirms a revised 3DS before FY end.

No. While the DS sold 2.3M in its relative 4th quarter (all of this refers back to fiscal year ending 3/06) with the help of a revision, the 3DS is on a path to easily exceed that. It out-shipped the DS in its relative Q3 by 50%, and despite its slow start is equal to the DS full fiscal year in just 3 quarters. 2.5M is a good prediction based on how it has been selling. If there was a revision, they probably would have predicted more.

So Wii shipped 10.3m in 2011 and 360 shipped 15m?

Wow, role reversal or what

Not exactly role reversal. 15M was considered a bad year for Wii.

 

[Omega.Blaze]

ouch - we need a "3DS - it shreds money!" gif with sad Iwata.



will be in the full financial details report.

If those sales are "ouch" to you, seeing how the Vita performs is going to be like stabbing a dagger through your heart.
----

When is that Nintendo meeting happening? I wonder what Nintendo is up to to keep improving the sales of their systems.

 

[bigtroyjon]

That's net income. Operating income is about $530m and it's not bad at all considering they are in a transition period.

They manufactured a lot of 3DS earlier in the year that didn't sell and then took a huge loss on inventory right when the price cut happened. Last quarters results weren't really as good as they look since that loss on hardware had already been counted up front.

Similar to MS writing off the RRod costs up front so that future years operating income wouldn't be affected by RRod.

 

[disco]

Ah this is depressing.

They're getting burned so hard for a few bad mistakes. 30% of the war chest gone in 9 months, stock price down 60% in a year. They seem to have been doing nothing wrong since September, how annoying. I really hope this all pans out positively.

 

[Tunavi]

I thought Nintendo would be doing well. I have no idea how business works.

 

[SolarPowered]

For another year or two, but it would take other numbers to really get past the Wii on Worldwide sales, and given that Microsoft is releasing a new console in 2013 I expect numbers to fall slightly in 2012.

That may happen, but the 720 is really just around the corner.

 

[Miles X]

For another year or two, but it would take other numbers to really get past the Wii on Worldwide sales, and given that Microsoft is releasing a new console in 2013 I expect numbers to fall slightly in 2012.

I think Wii's 29m~ shipment lead is far to large for MS to overcome. Closing the gap 4.7m this year though, it'll be interesting to see how low it goes before they're both dead. I think below 20m is a certainty.

 

[DCharlie]

If those sales are "ouch" to you, seeing how the Vita performs is going to be like stabbing a dagger

They'll be ouch too - but what does the Vita have to do with any of this?

 

[bigtroyjon]

I think Wii's 29m~ shipment lead is far to large for MS to overcome. Closing the gap 4.7m this year though, it'll be interesting to see how low it goes before they're both dead. I think below 20m is a certainty.

I think it all depends on the next xbox. If it's $400+ and in limited supply, then I think a $100 360 will sell like the PS2 did during the PS3's first couple of years on the market(at least in NA/UK) which could give them a chance at overtaking it.

Now if the next xbox doesn't sell well and the price has to be dropped(or launches cheap at $300), then it could kill off 360 sales sooner like the 3DS did to the DS.

 

[Neo C.]

Ah this is depressing.

They're getting burned so hard for a few bad mistakes. 30% of the war chest gone in 9 months, stock price down 60% in a year. They seem to have been doing nothing wrong since September, how annoying. I really hope this all pans out positively.

That's the story of all Japanese companies. The $ is just too low. If the USA were an average country, companies would say "our goods are now 20% more expensive, deal with it!" to the Americans. However, the USA is the most important market, therefore a lower $ doesn't affect the US-citizens as much as the foreign companies, which desperately rather take losses than miss the market.

That's why China tries to be less dependent on the dollar, and if Nintendo wants to make money in the future, Iwata should reconsider the entry into the market of China and South America (which Nintendo took it, funny enough, very seriously in the 80s when Arakawa and Lincoln weren't sure to win the case in the court).

 

[EloquentM]

Good time to buy Nintendo shares?

 

[bigtroyjon]

That's the story of all Japanese companies. The $ is just too low. If the USA were an average country, companies would say "our goods are now 20% more expensive, deal with it!" to the Americans. However, the USA is the most important market, therefore a lower $ doesn't affect the US-citizens as much as the foreign companies, which desperately rather take losses than miss the market.

That's why China tries to be less dependent on the dollar, and if Nintendo wants to make money in the future, Iwata should reconsider the entry into the market of China and South America (which Nintendo took it, funny enough, very seriously in the 80s when Arakawa and Lincoln weren't sure to win the case in the court).

Actually the dollar really doesn't have much to do with it. They have worked towards being dollar neutral and in the last 9 months have spent as many dollars as they've earned.

Now the Euro on the other hand....