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Barkley said:
Jumpin said:
Considering Nintendo generates by far most of their revenue from hardware sales, and a substantial amount licensing expenses, I am going to have to disagree.

Profit is more important than Revenue, Console hardware has horrendous profit margins in relation to software. Also you might be surprised...

2015:

Home Console Hardware Revenue - $879 Million

Handheld Console Hardware Revenue - $1.24 Billion

Total Hardware Revenue -  $2.12 Billion

 

Home Console Software Revenue - $706 Million

Handheld Console Software Revenue - $1.25 Billion

Total Software Revenue - $1.96 Billion

 

Not "by far" at all. There's no doubt software makes more profit for nintendo many many MANY times over.

Horrendous profit margins? Where are you getting that? Are you considering the profit generated by royalty sales on their hardware? Also, you can't judge an entire generation's profits based on a late-generation year where hardware sales are significantly down. When you consider the generation as a whole, Nintendo's hardware revenue vastly outstrips their software revenue, and in their best years, their profits greatly exceed their direct software revenue numbers as well, indicating a large portion of their profits is a result of their hardware business. The hardware business is why Nintendo is consistently (with only a few recent exceptions) the most highly valued videogame company in the world.

 http://www.zeldainformer.com/articles/a-deeper-analysis-of-nintendos-financials-why-they-cant-drop-hardware



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