| sc94597 said: Firstly, Nintendo has consistently made more revenue from hardware than software, even in 2013. http://abload.de/img/hard_soft_revj3ptw.png That in addition to the knowledge that Nintendo has always made a profit up until very recently (low Wii, Wii U and 3ds sales; high software, hardware and investment R&D), allows us to conclude that software sales have never made up for hardware costs, including hardware R&D. |
Ofcourse hardware makes more revenue, but revenue != profit.
Games can make up to 70% gross profit, and hardware gross profit is usually in the range of +/- 5%.
~$4.0 Billion Hardware Revenue = +/- $200 Million gross profit on hardware.
~$2.2 Billion Software Revenue = ~$1.54 Billion gross profit.
Approximate total gross profit range is $1.3 ~ $1.7 BIllion.
Actual Nintendo gross profit reported in last FY? ~$1.6 Billion so the estimate is right one the money.
~95% of Nintendo's gross profit comes from software.
