| trestres said: That's not really how it is. The way to judge if a business is going well is to look at the operating income, and not at the net income, which takes into account 1 time happenings like sales of buildings, exchange rate movements, etc. If we go back and check the operating results, we get the following: 2008: 555bn yen 2009: 356bn yen 2010: 171bn yen 2011: -37bn yen 2012: -36bn yen 2013: -46 bn yen Here the trend is one of total decline and sustained losses, 3 consecutive years of operating red numbers. I dont think Iwata will go, only because of the QoL promise, but he will have to resign if the QoL launch is a failure, since they will be consistently on the red with the VG department on years to come |
Even on that measure, we're looking at 2013-2014's loss being less than 10% of the profit made in 2008, and their 2011-2014 losses combined being less than their profit from the lacklustre 2010. So like I said, this is no huge loss. Also, net income includes things like interest gained on investments (for example, their stake in Pokemon Company), which is relevant to overall performance. Operating Income is a good measure of how the core business is performing at that point in time. Net Income tells you how the company's funds have actually changed.
Oh, and Nintendo hasn't been selling off buildings, they've been making new ones... indeed, their new headquarters is estimated to cost over 16 billion yen - that's not that much less than their actual net loss. Imagine if they hadn't been building it.
Investors are pretty smart - they don't just look at raw numbers, they look at the context. And when you look at Nintendo's relatively minor losses compared with Iwata's forward-looking activities (like establishing QoL, arranging new IP deals, building of a new headquarters, etc), you see a situation in which short term loss is being accepted with an eye to longer term stability.
