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Forums - Sales Discussion - Nintendo Profit per Console

Can anyone tell me what the profit per console Nintendo were making when they first released the Wii?

And would anyone know what, if any, price reduction has gone on with the Wii and how much profit per console they are now making?

I know it was somewhere around $50 per unit but I would like to know for sure. And I'm guessing it would now at least be $70 per Unit with cost reductions and all. 

I would just like to work out an estimated number of what profit they have made on just hardware alone.



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Exact official numbers are pretty hard to come by, I believe the number for launch was $47, as I seem to remember hearing that number a few times. Right now I would not be surprised if they were making as much as $85 per unit, but the likely answer is going to be around $68-$75 if I were to guess.

If you find the answer please share it with us, it would be interesting to know.



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I have a hard time believing they were making 50 bucks when the Wii first came out. I think the entire cost of the Wii, controller, Wii Sports and such came to about $212, and then they sold it to retailers for maybe $234. The profit margin wasn't big initially, but it was profit nonetheless.

iSupply usually has component breakdowns. Anyone have the Wii one?



I'm searching for the info so if I do find it, I'd be glad to share.

I remeber a big huffuffle about the price being too cheap for retailers with nintendo selling it at $199 so they decided to up that price to $250, hence the estimation of $50 per console.

What does Japan sell for? They don't have wii Sports yet Nintendo still made a profit from launch consoles.



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The Wii is sold to Toys R Us for 249.98.



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But how much of that is Nintendo's profit? I would like to find out manufacturing costs.

I found that it costs $158.30 to manufactur, not including Wii motes or Wii Sports at launch.

http://www.engadget.com/2006/12/15/wii-manufacturing-costs-ring-up-to-just-158/

 EDIT:

It costs $60 Retail for an extra Remote and Nunchuch but retailers make a reasonable profit on them and Nintendo is making good profit off them too so how much does a Wiimote and Nunchuck costs to manufacture? I'm guessing no more then $40 which would bring the Wii costs to roughly $200 (Which is reported in the above link).

Wii sells for $215 in Japan so what is the retail markup there?

Add Wii sports for the US and your looking at roughly the same as what Dolla Dolla stated.



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People write off wii sports as no expense, but imagine how much money Nintendo could have made if they sold it seperately. That's all potential profit that they are giving up.



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I'm guessing they have reduced costs significantly since launch. They should be getting big volume discounts now that they are producing well over a million a month. That's one advantage to being the leader, economy of scale.



Ok so What I can work out, Nintendo were making $20 - $35 profit per console at launch.

Now all I'd like to find out is what cost reduction they've gone through.

 EDIT:

If you write off Wii sports as it only a cost of a disk (Japan Alone has Made back its development costs), you would be looking at $35 - $50 profit per console in the US. 



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Dolla Dolla said:
I have a hard time believing they were making 50 bucks when the Wii first came out. I think the entire cost of the Wii, controller, Wii Sports and such came to about $212, and then they sold it to retailers for maybe $234. The profit margin wasn't big initially, but it was profit nonetheless.

iSupply usually has component breakdowns. Anyone have the Wii one?

Both of my numbers were based purely on production cost and sale price.  I have no idea how much they actually make after shipping, retail markup etc...If I had thought about it I would of specified before.  In any case like I said neither of those numbers are meant to be taken as absolutes.  As I mentioned one is what I had heard and the other was a pure guess.



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