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czecherychestnut on 03 August 2013
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Cleary397 said:
AnthonyW86 said:
Cleary397 said:
UncleScrooge said:
And in their financial report they said they are losing money with the Wii U. They hardly made any money at all despite 3DS hardware and software selling well and Abenomics.


Its the same situation with Sony game division at the moment though.

Massive lossed despite the PS3 selling incredibly well, though the Vita is underperforming.

Its because of recent R&D Costs for all the big 3

No it's not. Sony has big R&D costs because the PS4 is yet to be released, the Wii-U has been released a long time ago. Sure Nintendo have a big amount of games in development but it's in no way comparable to the release of a system.

But the amount of R&D money that goes into a console in its first year of release is huge.

There has to be funding for bug fixes, any extra infrastructure needed to support any online services, updates to features and the development and testing of new features.

It is not just spend the money then release it, it continues for a long time.

True, but even still R&D costs would be higher before launch than after launch, yeah there are bug fixes and feature updates after launch, but nothing compared to what they'd currently be going through pre-launch during internal testing and development. And online service infrastructure needs to be stood up before launch to handle the surge in use on launch day (when everyone picks up their shiny PS4's and connects to the PSN). So though there is elevated R&D costs after launch, I'd still contend that they would be lower than pre-launch. 

As for Nintendo's 2 games to profitability statement regarding Wii-U, as others have said that would have been assuming sales were in line with their projection at the start. Given they are far below that, all their fixed costs are spread over fewer consoles/game sales, and therefore they need a higher number of console/game sales to compensate. Not that they won't get there soon, but from the wording they used during their last financial statement they aren't there yet.