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Forums - Nintendo - Nintendo Lowers 2016 financial forecast

Dunban67 on 26 February 2016

REVENUE down by 1/2!!!????  That is huge-  I have not read the release yet but that is a MAJOR hit-   (correction! Net income is projected down by 51% a huge difference-  still not good but not nearly as bad as if revenue were down that much)

 

It sounds like they are cleaning up thier financials for the future but wow!

 

although revenue is not down by 1/2; the cut in revenue this fiscal year indicates Nintendo s revenue will be the lowest  in 15 years-  that does not loook good

Nintendo did blame exchange rates and lower 3ds hardware and software for the lower estimates



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justiceiro on 26 February 2016

We should also consider that the previous forecast count with then release miimoto before last year end, but now will be release on the end of the fiscal year.



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Sh1nn on 26 February 2016

15-Year Low

Operating income will be 33 billion yen this fiscal year, down from an earlier projection of 50 billion yen. The currency fluctuation reduced profit by 20 billion yen, Nintendo said. The company cuts its projection for sales 12 percent to 500 billion yen, the lowest revenue level in at least 15 years.

“Sales of the 3DS fell short of our targets from January,” Nintendo spokesman Yasuhiro Minagawa said. “After adding the impact of stronger yen, we had no choice but to revise.”

The forecast cut shows how much is riding on Nintendo’s foray into mobile. The shares rose 33 percent last year, fueled by the March announcement that the company planned to develop titles for mobile devices made by other companies. Much of the gains were lost, however, after Nintendo delayed the debut in October.

http://www.bloomberg.com/news/articles/2016-02-26/nintendo-cuts-annual-profit-forecast-amid-weak-christmas-sales



Ljink96 on 26 February 2016

They're not doing much right now. Nothing huge is gonna be released between now and May 31st. Silence before the storm.



Goodnightmoon on 26 February 2016

Transitions are expensive.



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Roronaa_chan on 26 February 2016
maxleresistant said:

The WiiU isn't selling, the 3DS sales are going down, they have less and less software to sell on the WiiU, and they are currently spending a lot of money to prepare the next gen.

All that tells you what they should be doing, and "preparing for next gen" sure ain't it.



Mnementh on 26 February 2016
Soleron said:
zorg1000 said:

Xenoblade 3D, Splatoon, Super Mario Maker, Happy Home Designer, Chibi-Robo, Woolly World, Triforce Heroes, Super Mystery Dungeon, Ultra Smash, Amiibo Festival, Xenoblade X, Paper Jam, Fire Emblem, Twilight Princess HD, Hyrule Warriors Legends, Rhythm Heaven, Girls Mode 3.

I might be missing some but those are the retail games by Nintendo released or set to release this fiscal year, this isn't including the dozen or so digital only releases either.

Any of those games sell Wii Us? Have people outside of the Nintendo bubble even heard of those games?

 Moving goalposts? You said that the reduced revenue is because of missing games, now you talk about WiiU. Notification: games sell for money, the WiiU doesn't bring in much profit (if it does at all). So for the business numbers the sold WiiUs are secondary. Sold games are more interesting.

Well, and nobody outside of the Nintendo bubble ever heard of Fire Emblem, Zelda, Paper Mario, Warriors-games and Splatoon? Hmm, ok.



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Mnementh on 26 February 2016
ZhugeEX said:

There are 2 key points as to why both revenue and profit guidance has been revised down.

1. Exchange Rate for Japanese Yen
2. Lower than expected 3DS Hardware and Software sales

The R&D costs were always factored in to the guidance and they won't have suddenly increased spending this year for no reason.

What is of note though is that they expect Wii U software sell in to be slightly higher, I imagine this is due to the continued success of Splatoon & Super Mario Maker as well as the release of Nintendo Selects titles.

zippy said:
Transitional period for Nintendo results in low financial forecast...well knock me down with a feather.

What you're failing to mention is that this is a revised forecast from Nintendo themselves. They were actually expecting to do better this year but ultimately have had to revise their forecast down due to the reasons above.

 Thanks for this post and I fully agree with all your points.



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10 years greatest game event!

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Fei-Hung on 26 February 2016

Nintendo should have gone solo with the mobile leap and launched it from a new studio with the HQ in the states.

They could have made some really small but profitable games from their back catalogue like:

Dr Mario
A simplified Pokemon game
A Tamagochi style Pokemon app
A endless runner Mario game with a take on some of the famous levels

I think one of the most important things Nintendo can do is partner with MS, Sony or both to create crossover games. This like:

LBP VS Mario Kart racing
SSB VS PSASBR
Release a Nintendo pack on LBP



OneKartVita on 26 February 2016
Soundwave said:

Poor hardware sales in the game business always leave you at the mercy of things like currency swings. It is what it is.

Been a nightmare of a generation for Nintendo, a tsunami and nuclear meltdown literally greeted the 3DS launch, both Mr. Yamauchi and even more sadly Mr. Iwata are gone, hardware sales are hitting all time lows which is holding back software sales, virtual near abandonment from third parties, complete collapse of their console biz etc. etc.

It really has been a staggeringly bad 5 year stretch for Nintendo. Unimaginable pretty much. 

Yeah it really couldn't have gone worse.  From the top to the bottom.  But are we at rock bottom?  Will 2016 level off the decline and will growth return on 2017 onwards or is the decline going to continue.