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Forums - Nintendo Discussion - Nintendo have not made an operating profit overall this generation.

Miyamotoo said:

People don't understand that bottom of line is profit at end, not operating income.

And if we look profit, things are quite difrent.

Operating Profit is a better indication of a how a business is performing than Net Profit. But I have changed the thread title to specify Operating Profit.

"Operating income and operating profit are synonyms for the income produced by operations in a business. This income is the net of revenues minus operating expenses, cost of goods sold and depreciation reported on a company's income statement. Operating income/profit is an important number for investors to review on the income statement, as it shows how efficiently the company generates a profit."

"Many analysts emphasize the importance of operating profit over net profit, simply because it shows the core of the business and how well it can perform. Net profit can be influenced by many different variables from year to year, but if operating profit steadily increases, an investor knows the business is on the right track."

Net Profit is affected by many things that are even outside of Nintendo's Control, Operating Profit shows exactly how well the company is performing.



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Soundwave said:
Nuvendil said:

We'll, if the app stays on track (no guarantee it will), it will pull in billions.  Because of Nintendo'stock partial ownership of The Pokémon Company, after all other cuts are taken Nintendo would still make hundreds of millions from Pokemon Go, enough to drastically improve their bottom line proportionate where it has been recently.  Now, they won't make billions but that doesn't mean it won't be a very successful venture for them and a strong starting point for mobile projects in the future.

Pokemon Go is just the tip of the iceberg for Nintendo's mobile profit potential. They could make 10 different apps about Pokemon alone, and Pokemon Go 2 is almost a certainty to happen and I think Nintendo will publish that game themselves to ensure a larger cut of the profit. 

Not sure if they can be the publisher, the contracts surrounding their relationship with Pokémon may prevent it.  And I don't know if a 2 will be needed, they could just keep updating this.  In fact, rather than a 2, they could promote each generation as a new, massive leap.  Pokemon GO 2.0, if you will.

My biggest take away from this is Nintendo is not and this new release is not teaching them to just slap their games on mobile.  Rather, they are looking to create games directly targetted at the mobile audience.  They aren't double dipping into their current fanbase like Square Enix with 90% of their offerings, they are expanding into a new audience that hasn't played their games in a long time, perhaps ever.  Thus, this is creating a true third pillar for them, bringing in truly new revenue that they couldn't get otherwise.  And this can feed into their other businesses as well.  Pokemon's brand power is now at an all time high and it would seem it is having an impact already as the New 3DS models on Amazon have soared up the Amazon charts along with Pokémon Sun and Moon and other Pokémon games in every region the game has been released.  

Another thing is that as much as this feels like an early release, Pokémon GO lacks some of the most detested things that dominate mobile.  Most importantly, it doesn't psychologically pummel you into spending money.  The micro transactions can provide convenience but in now way are needed to make brisk progress.  So this isn't just success financially, but also can have a positive impact for Nintendo'stock image as a company, establishing consumer trust if they continue this pattern with future mobile releases.

Overall, I find this very encouraging.  It shows Nintendo isn't looking to leave money on the table by doubling down on current fans or using the sleazy micro transaction tactics of so many.  And it appears to be serving as marvellous advertisement.



Barkley said:
Miyamotoo said:

People don't understand that bottom of line is profit at end, not operating income.

And if we look profit, things are quite difrent.

Operating Profit is a better indication of a how a business is performing than Net Profit.

"Operating income and operating profit are synonyms for the income produced by operations in a business. This income is the net of revenues minus operating expenses, cost of goods sold and depreciation reported on a company's income statement. Operating income/profit is an important number for investors to review on the income statement, as it shows how efficiently the company generates a profit."

"Many analysts emphasize the importance of operating profit over net profit, simply because it shows the core of the business and how well it can perform. Net profit can be influenced by many different variables from year to year, but if operating profit steadily increases, an investor knows the business is on the right track."

Net Profit is affected by many things that are even outside of Nintendo's Control, Operating Profit shows exactly how well the company is performing.

Operating Profit is important for company, but bottom of line is of course profit at end, Net profit tells us how many money Nintendo actually made at end not operating profit. So if look profit we see that basically Nintendo is currently without loss and profit basically on positive zero, but with current fiscal year they will become profitable this gen.

So you in OP said Nintendo lost money this gen, and that obviously is not true.



naruball said:
tak13 said:

lol It was never sold at a loss how it would lose money? And for a 21.74m selling hardware, its software sales were pretty high...

 

Which games? As for the poor sales... There is something good with them, since wii u was being sold at a loss, if it was selling way better it would lose more money and I'm not sure if the software sales would be in a extend to offset them, especially providing that there was no third party support!

 

As for the edit part, that's a frustrating downplaying! What do you mean by that?  It's always ps4/xbone just in the UK ( but it in the USA, is expected since we get only a top ten an that with multiplatform games sales combined, in single skus you see 3ds titles and not lately released ) , lol you say everywhere do you watch german charts for instance? Or how you feel about yokai watch slaying uncharted 4 in Spain charts?

 

Is smash bros 3DS selling 3m in the USA a flop? Which ps or especially xbox exclusive can  match Mario kart 7 or Pokemon x/y sales nowadys ?  You could  have word your opinion  differently, no offense but as is now it manifests something suspicious, you draw a negative picture with things that are invalid!

Yeah it used to be different with the beasty ds but that was an anomaly... You can guess why! Before ds it was GBA.... Eh? Anywise, 3ds has almost the same attach rate with ds while destroys gba in that  part!

You can't say that a handheld platfrom with 60m hardware sales and 300m software sales, isn't selling much software, based on selective use of sales charts and individual cases!

Ok, dude. This is rich coming from you. You paint Ninty in a positive picture in every single post I've see from you. So, let's not be hypocrites, shall we? You probably find this "suspicious" because I don't paint your favourite company the way you want.

"if it was selling way better it would lose more money". Hardcore fans will twist anything bad into something postive, I guess. 

A simple google search would tell you that wiiu was sold at a loss when it launched and for some time after that. Please, don't spread misinformation.

Yes, I see all the charts. Ps4 games dominate them. You're looking at the exceptions because of your confirmation bias.

"based on selective use of sales charts and individual cases". The irony is strong with this one.

hahahaaha I know it already naru and better than you ( I can even put the reasons why wii u was being sold at a loss, one by one  ) why did you say that? Lately, i was talking about the wii u two year loss ! People who care for Nintendo, search for both positive and negative things to have a full picture and when they're as much as objective they can be  they know better their favorite company's  position, than those who aren't interested in or dislike  it! As for them being rich, google Nintendo is not doomed...

I didn't twist anything... There is something good with them, since wii u was being sold at a loss, if it was selling way better it would lose more money and I'm not sure if the software sales would be in a extend to offset them, especially providing that there was no third party support! I'm saying something logical, would sony lose so much money with ps3 if it was selling  like wii u? It's not my fault if you can't comprehend this!  Maybe Nintendo didn't make any move to boost wii u sales to not lose more money within those two years when it was being sol at a loss, eh? There's always something positive in negative things, that's the spirit of this argument!

  

Thanks for the blatant and virulent attack  along with the accusation for bias! Ι could have reciprocate taking into account your comment  history too but I didn't, you lost your temper, I won't lost mine!

 

I avoided to  reproach  you for the the same things,  contrarily! Most of the time I choose to stay polite and don't hurt people in vein/when I'm not sure they deserve it or do an injustice to them, you sould have appreciate that!



tak13 said:
 

You can tell anything negative about Nintendo but not when it comes to their strong point, software sales! Lets see if uncharted 4 will outsell Mario kart 8... Or  how much halo will end up behind it... ( Unless  NX release date announcement, kills MK8 legs and its expontentially increasing attach rate, I hope it won't ! )

 

Yes you can.

Just some examples:

March npd

  1. Tom Clancy’s The Division (PS4, Xbox One, PC)
  2. Far Cry: Primal (PS4, Xbox One, PC)
  3. The Legend of Zelda: Twilight Princess HD (Wii U)
  4. Grand Theft Auto V (PS4, Xbox One, 360, PS3, PC)
  5. UFC 2 (PS4, Xbox One)
  6. MLB 16: The Show (PS4, PS3)
  7. Pokken Tournament (Wii U)
  8. NBA 2K16 (PS4, Xbox One, 360, PSe)
  9. Call of Duty: Black Ops III (Xbox One, PS4, 360, PS3, PC)
  10. Minecraft (360, PS4, Xbox One, PS3)

April npd

  1. Dark Souls III (PS4, Xbox One)
  2. Ratchet & Clank (PS4)
  3. MLB 16: The Show (PS4, PS3)
  4. Tom Clancy’s The Division (PS4, Xbox One, PC)
  5. Grand Theft Auto V (PS4, Xbox One, 360, PS3, PC)
  6. Minecraft (Xbox One, 360, PS4, PS3)
  7. Quantum Break (Xbox One)
  8. Call of Duty: Black Ops III (Xbox One, PS4, 360, PS3, PC)
  9. NBA 2K16 (PS4, Xbox One, 360, PS3)
  10. Star Fox: Zero (Wii U)

May npd

  1. Uncharted 4: A Thief's End (PS4)**
  2. Doom 2016 (PS4, XBO, PC)**
  3. Overwatch (PS4, XBO, PC)**
  4. Battleborn (PS4, XBO, PC)
  5. Grand Theft Auto V (PS4, XBO, 360, PS3, PC)
  6. Minecraft (XBO, 360, PS4, PS3)
  7. NBA 2K16 (PS4, XBO, 360, PS3)**
  8. Call of Duty: Black Ops III (XBO, PS4, 360, PS3, PC)**
  9. MLB 16: The Show (PS4, PS3)**
  10. Dark Souls III (PS4, XBO)**

Not gonna go through every single chart, but it gives you an idea of how much the 3ds has been selling. Sure, there were other months were some titles charted, but overall it's not doing well. It does not look healthy. Sony has a constant stream of successful titles (1st and 3rd party). That goes for most countries, Japan being the exception. Also, comparing Yokai with Uncharted 4 in a single region is not doing you any favours.



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Barkley said:
Yes R&D costs, which includes the costs of developing the WiiU, WiiU R&D costs may partly be included in FY 2011. Also as the generation is ending March 2017 I find it highly unlikely Nintendo will post a profit overall this generation. If Nintendo is losing money you can bet your ass it's all down to the WiiU. The 3DS must be quite profitable, but it's not been enough to overall put Nintendo in the black this generation.

As for people not saying the WiiU made a profit...

But R&D for NX will have been included in the last few years, too. Plus any other R&D that they've been doing (among other things, there's the Vitality sensor, that was still being worked on in 2011-2013).

And then there's purchases, such as the "US$100 million" tech purchase. They tend to be ignored when people look at these graphs, too.

Plus, the yen strengthened dramatically from 2011 to 2016. This is a problem because they set their prices based on the exchange rate at the time of release of the system, and can't easily raise the price if exchange rates become an issue. This impacted both the 3DS and Wii U.

So I stand by what I've already said.



naruball said:
tak13 said:

You can tell anything negative about Nintendo but not when it comes to their strong point, software sales! Lets see if uncharted 4 will outsell Mario kart 8... Or  how much halo will end up behind it... ( Unless  NX release date announcement, kills MK8 legs and its expontentially increasing attach rate, I hope it won't ! )

 

Yes you can.

Just some examples:

March npd

  1. Tom Clancy’s The Division (PS4, Xbox One, PC)
  2. Far Cry: Primal (PS4, Xbox One, PC)
  3. The Legend of Zelda: Twilight Princess HD (Wii U)
  4. Grand Theft Auto V (PS4, Xbox One, 360, PS3, PC)
  5. UFC 2 (PS4, Xbox One)
  6. MLB 16: The Show (PS4, PS3)
  7. Pokken Tournament (Wii U)
  8. NBA 2K16 (PS4, Xbox One, 360, PSe)
  9. Call of Duty: Black Ops III (Xbox One, PS4, 360, PS3, PC)
  10. Minecraft (360, PS4, Xbox One, PS3)

April npd

  1. Dark Souls III (PS4, Xbox One)
  2. Ratchet & Clank (PS4)
  3. MLB 16: The Show (PS4, PS3)
  4. Tom Clancy’s The Division (PS4, Xbox One, PC)
  5. Grand Theft Auto V (PS4, Xbox One, 360, PS3, PC)
  6. Minecraft (Xbox One, 360, PS4, PS3)
  7. Quantum Break (Xbox One)
  8. Call of Duty: Black Ops III (Xbox One, PS4, 360, PS3, PC)
  9. NBA 2K16 (PS4, Xbox One, 360, PS3)
  10. Star Fox: Zero (Wii U)

May npd

  1. Uncharted 4: A Thief's End (PS4)**
  2. Doom 2016 (PS4, XBO, PC)**
  3. Overwatch (PS4, XBO, PC)**
  4. Battleborn (PS4, XBO, PC)
  5. Grand Theft Auto V (PS4, XBO, 360, PS3, PC)
  6. Minecraft (XBO, 360, PS4, PS3)
  7. NBA 2K16 (PS4, XBO, 360, PS3)**
  8. Call of Duty: Black Ops III (XBO, PS4, 360, PS3, PC)**
  9. MLB 16: The Show (PS4, PS3)**
  10. Dark Souls III (PS4, XBO)**

Not gonna go through every single chart, but it gives you an idea of how much the 3ds has been selling. Sure, there were other months were some titles charted, but overall it's not doing well. It does not look healthy. Sony has a constant stream of successful titles (1st and 4rd party). That goes for most countries, Japan being the exception. Also, comparing Yokai with Uncharted 4 in a single region is not doing you any favours.

Those are the selective and individual cases that I was talking about! You do the same mistake that many people do...

NPD? Only top ten with multi-platform  game, with their sales combined? How the fuck an exlusive game will chart there for more than 1 month  or how there will be 3ds games there  there are no recent releases? And 3ds is 6 years old!

 

In single skus or better,  a bigger chart, you would see  3ds titles...

 

You could have used at least  uk chart instead, in order to support your argument...



Unless they completely drop consoles and go full mobile +Steam / multiplattform, there won't be any profits in future too, unfortunately.



Well they have Pokemon Go now so profits should be a given.



think-man said:
Well they have Pokemon Go now so profits should be a given.

With the added income from Mobile and NX almost certainly to outperform the WiiU Nintendo should have no problem over the next few years. Though with the 3ds getting on in years Nintendo has to replace that system too, assuming the NX isn't a hybrid. Either way the next few years for Nintendo are going to be very interesting and hopefully a lot more succesful than there last few.