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Forums - Nintendo - Nintendo still selling Wii U at a loss

Soundwave on 08 August 2013

They likely aren't factoring in currency flucuations though, so while the Wii U may still take a "loss" to manufacture, the fact is Nintendo is saving $70 per system at a $300-$350 price per unit due to the yen depreciation since last November.

That's just a fact.



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Max King of the Wild on 08 August 2013
Soundwave said:
They likely aren't factoring in currency flucuations though, so while the Wii U may still take a "loss" to manufacture, the fact is Nintendo is saving $70 per system at a $300-$350 price per unit due to the yen depreciation since last November.

That's just a fact.


Why are you factoring in MSRP into your calculations? ...or do yo9u think Nintendo gets all $350?



oni-link on 08 August 2013
Max King of the Wild said:
This was obvious for anyone who wasn't nintendo fan. Not only did they say they needed more than one game per unit to turn profit but the technology they went with wont drop as fast as something like the x1, ps3, 360, or ps4 will have. On top of that, the comment about being profitable after one game went with their projection of 5.5mil at the end of march. Law of diminishing returns here. After sales slumped as much as they did the losses increased.

What tech are you talking about and how are you justifying this comment.  Sorry just wanted clarification b/c it sounds like the usual stealth trolling to me...pls clarify.



Soundwave on 08 August 2013
Max King of the Wild said:
Soundwave said:
They likely aren't factoring in currency flucuations though, so while the Wii U may still take a "loss" to manufacture, the fact is Nintendo is saving $70 per system at a $300-$350 price per unit due to the yen depreciation since last November.

That's just a fact.


Why are you factoring in MSRP into your calculations? ...or do yo9u think Nintendo gets all $350?


Even if it costs Nintendo lets say $380 a unit to make a Wii U (which is somewhat ridiculous IMO but lets go with that number), the weakening yen still means they save $70 now on units sold in North America now over last November. That's just how it goes.



oni-link on 08 August 2013
justinian said:
oni-link said:
Where is the link that says that Reggie or Nintendo backtracked on one game sold and it makes up the loss? AFAIK as long as the Wii U sells one software (the Nintendoland bundle don't count) that Nintendo made up the loss. Also it had better be some legit shit and not some poster from Gaf. If it came from a forum I call a big pile of B$ on that one!


 You have every right to doubt anything written in this - or any other - forum without hard proof.

I did some research and found this a while back:

http://www.mercurynews.com/top-stories/ci_22013695

I believe it to be true but I will leave that decision up to you. I think it is significantly more than one piece of software simply because if it was a small figure they would have proudly stated it. The bigger the number the more embarassing it becomes so best to keep the figure hidden. That of course is speculation on my part.

Here is the extract:

SETTING THE RECORD STRAIGHT (publ. 11/25/2012, pg. A2)
In a story about Nintendo of America President Reggie Fils-Aime, Fils-Aime incorrectly said that Nintendo makes a profit on the Wii U console after consumers buy one piece of software. The number is more than one, but the company declined to say the exact number.

okay fine then it's probably 2 games then . In regards to the bolded part it is just typical Nintendo of Japan mentality not to disclose or limit the amount of information regarding their system instead of a significant loss.  Nintendo's history of producing consoles with a profit or in the case of the 3DS a profit not long after the price cut shows their stance on this!!!  You are reading too much into it!!!



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oni-link on 08 August 2013
Soundwave said:
Max King of the Wild said:
Soundwave said:
They likely aren't factoring in currency flucuations though, so while the Wii U may still take a "loss" to manufacture, the fact is Nintendo is saving $70 per system at a $300-$350 price per unit due to the yen depreciation since last November.

That's just a fact.


Why are you factoring in MSRP into your calculations? ...or do yo9u think Nintendo gets all $350?


Even if it costs Nintendo lets say $380 a unit to make a Wii U (which is somewhat ridiculous IMO but lets go with that number), the weakening yen still means they save $70 now on units sold in North America now over last November. That's just how it goes.

@soundwave

Oh I get it!!! Thanks I was gonna ask you about that too. 



Max King of the Wild on 08 August 2013
Soundwave said:
Max King of the Wild said:
Soundwave said:
They likely aren't factoring in currency flucuations though, so while the Wii U may still take a "loss" to manufacture, the fact is Nintendo is saving $70 per system at a $300-$350 price per unit due to the yen depreciation since last November.

That's just a fact.


Why are you factoring in MSRP into your calculations? ...or do yo9u think Nintendo gets all $350?


Even if it costs Nintendo lets say $380 a unit to make a Wii U (which is somewhat ridiculous IMO but lets go with that number), the weakening yen still means they save $70 now on units sold in North America now over last November. That's just how it goes.



Im confused as to where you pulled 380 from...

Secondly, these Wii U's that are being sold were probably produced months ago anyway. Or do you think Nintendo expected 5.5mil at the end of march and produced only 3mil before sales slumped and Nintendo were like "Okay guys, lets only make as we sell"

And finally, Nintendo doesn't get anywhere near $380. Probably half of that. If they cut anything on production its probably closer to $30. But again, laws of diminishing returns say it probably costs more now to produce then when they launched



Max King of the Wild on 08 August 2013
oni-link said:
Max King of the Wild said:
This was obvious for anyone who wasn't nintendo fan. Not only did they say they needed more than one game per unit to turn profit but the technology they went with wont drop as fast as something like the x1, ps3, 360, or ps4 will have. On top of that, the comment about being profitable after one game went with their projection of 5.5mil at the end of march. Law of diminishing returns here. After sales slumped as much as they did the losses increased.

What tech are you talking about and how are you justifying this comment.  Sorry just wanted clarification b/c it sounds like the usual stealth trolling to me...pls clarify.



Well considering after I saw your avatar I am pretty sure you are the one that I argued with about Wii U being profitable months ago. So, no... i'd rather not but if you think thats trolling then I advise you to look in a dictionary



Conegamer on 08 August 2013

It's not a surprise. After all, they aren't making all that many so likely aren't buying in large enough quantities to make a major deal, but more importantly is that it was quite a hefty loss (about $50). That ain't gonna change in less than a year, and we would hear when it starts to make a profit.



 

Here lies the dearly departed Nintendomination Thread.

Soundwave on 08 August 2013
Max King of the Wild said:
Soundwave said:
Max King of the Wild said:
Soundwave said:
They likely aren't factoring in currency flucuations though, so while the Wii U may still take a "loss" to manufacture, the fact is Nintendo is saving $70 per system at a $300-$350 price per unit due to the yen depreciation since last November.

That's just a fact.


Why are you factoring in MSRP into your calculations? ...or do yo9u think Nintendo gets all $350?


Even if it costs Nintendo lets say $380 a unit to make a Wii U (which is somewhat ridiculous IMO but lets go with that number), the weakening yen still means they save $70 now on units sold in North America now over last November. That's just how it goes.



Im confused as to where you pulled 380 from...

Secondly, these Wii U's that are being sold were probably produced months ago anyway. Or do you think Nintendo expected 5.5mil at the end of march and produced only 3mil before sales slumped and Nintendo were like "Okay guys, lets only make as we sell"

And finally, Nintendo doesn't get anywhere near $380. Probably half of that. If they cut anything on production its probably closer to $30. But again, laws of diminishing returns say it probably costs more now to produce then when they launched


I really, really, really, reaaaaaaaally doubt it costs more today to produce than when it launched.

DDR3 RAM, something that's likely the equivalent of a 450 GFLOP GPU, three cheap ass CPU cores, a modified Blu-Ray drive, and a low resolution touch panel with a $3 battery pack aren't components that are magically going to increase in cost.

There's nothing exotic or crazy in the Wii U design other than maybe the 32MB eDRAM.

Nintendo tends not to overproduce inventory early in the cycle anyway, this is why the original Wii was undersupplied, even though Nintendo was actually manufacturing quite a few, they were afraid to get stuck with inventory.