Miyamotoo said:
RolStoppable said:
The 3DS was responsible for the first fiscal year with an operating loss (due to an early significant price cut) and it took a while until 3DS hardware returned to profitability. Wii U hardware was sold at a loss from the start, so it didn't help Nintendo's bottom line.
As for the argument that Nintendo should keep making hardware because they are still profitable despite a low volume of sales, that makes a whole lot more sense when losses for selling hardware do not apply anymore. That's what holds largely true for the latter years of this generation.
But the bigger reason for Nintendo to keep making hardware is that the potential profits from such a business model are far greater than going third party. Regarding the losses this generation, a company like Nintendo which has several billions of cash reserves easily survives it. The losses would have had to be multiple times higher in order to humor a legitimate discussion about whether or not Nintendo should go third party. As it is, it was and is nothing more than wishful thinking of people who do not want to buy Nintendo hardware for whatever reason. |
Actualy Wii U was sold at loss only in 1st year or so.
Fact is there will not lose any money this gen, they have operating loss yes, but overall they will have solid profit from this gen.
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This is false. They never announced Wii U hardware was being sold at a profit, that is a misconception from 2014 and it baffles me that people still believe that to be the case. What Nintendo actually said was that Wii U hardware wouldn't incur any more losses for that period, because they were sitting on a lot of unsold Wii U inventory after they shipped less than they expected. Since this also meant they would have to manufacture less Wii U units than expected, the revenue from already manufactured units (where the loss was incurred in an earlier period) would exceed the loss from manufacturing new Wii U units. Hardware still had a negative margin.
