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Forums - Sales Discussion - How do you know if a game or console made profit or not?

Tetsuya on 21 July 2007

double post by mistake



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DonWii on 21 July 2007

Yeah. Yes.



Tetsuya on 21 July 2007
DonWii said:
You sure are asking a lot of 'interesting' questions lately...

That would be the revenue that was generated from the game. Calculating profit is difficult, because of the unknown development costs, as well as the added expenses of publishing a game, such as marketing. However, because it is a first party game, they do not have to pay royalties, for example.

On the topic of Nintendo making money.... They make a profit on all the hardware they make, they tend to sell enough copies of first party games to always turn a profit, AND they get paid for every single 3rd party game that is sold on their platform.

Not going to post the "It prints Money"

yea i know its just i have alot of things on my mind and i what some of the thoughts to be answered...why am i doing something wrong?? tell me in i am?



DonWii on 21 July 2007
Tetsuya said:
 

yea i know its just i have alot of things on my mind and i what some of the thoughts to be answered...why am i doing something wrong?? tell me in i am?

The only topic that was, in a sense, out there was the one were you were asking about "signs that a console is about to fail". The rest are just questions people don't tend to ask-though they are worth asking.

Tetsuya on 21 July 2007
DonWii said:
Tetsuya said:
 

yea i know its just i have alot of things on my mind and i what some of the thoughts to be answered...why am i doing something wrong?? tell me in i am?

The only topic that was, in a sense, out there was the one were you were asking about "signs that a console is about to fail". The rest are just questions people don't tend to ask-though they are worth asking.

yea i understand....im just curious thats all...like DonWii i just have one question and can u help me...lol...*dont hit my head though* ok..say for example i bought Console A...and as years go on i see no games and the console just fails...what should i do??



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DonWii on 21 July 2007
Tetsuya said:
DonWii said:
Tetsuya said:
 

yea i know its just i have alot of things on my mind and i what some of the thoughts to be answered...why am i doing something wrong?? tell me in i am?

The only topic that was, in a sense, out there was the one were you were asking about "signs that a console is about to fail". The rest are just questions people don't tend to ask-though they are worth asking.

yea i understand....im just curious thats all...like DonWii i just have one question and can u help me...lol...*dont hit my head though* ok..say for example i bought Console A...and as years go on i see no games and the console just fails...what should i do??


You should mourn for your Virtual Boy. I did.

ceres on 21 July 2007

Revenue is also hard to determine. I got NSMB for $27. Not everyone paid $35.



To cash in my CC rewards points for $300 in Circuit City gift cards to purchase a 360 or not: That is the question.

WiteoutKing on 22 July 2007
DonWii said:
Tetsuya said:
DonWii said:
Tetsuya said:
 

yea i know its just i have alot of things on my mind and i what some of the thoughts to be answered...why am i doing something wrong?? tell me in i am?

The only topic that was, in a sense, out there was the one were you were asking about "signs that a console is about to fail". The rest are just questions people don't tend to ask-though they are worth asking.

yea i understand....im just curious thats all...like DonWii i just have one question and can u help me...lol...*dont hit my head though* ok..say for example i bought Console A...and as years go on i see no games and the console just fails...what should i do??


You should mourn for your Virtual Boy. I did.

 I still do.



PS3: 5.51m/51w, avg 108,039/w (up 239)
360: 12.93m/102w, avg 126,764/w (up 625), leads PS3 by 7.42m (up 70k), avg lead 18,725/w (up 386)
Wii: 13.52m/51w, avg 265,098/w (dn 1,102), leads PS3 by 8.01m (up 90k), avg lead 157,059/w (dn 1,341)

If 360 sales stabilize, PS3 sales increases needed to pass 360 by...
01/08: (008w) +875.8%, 04/08: (021w) +344.4%, 07/08: (034w) +219.3%, 10/08: (047w) +163.5%
01/09: (060w) +131.8%, 04/09: (073w) +111.4%, 07/09: (085w) +098.1%, 10/09: (099w) +086.7%
If Wii sales stabilize, PS3 sales increases needed to pass Wii by...
01/08: (008w) +1072.%, 04/08: (021w) +498.4%, 07/08: (034w) +363.4%, 10/08: (047w) +303.1%
01/09: (060w) +269.0%, 04/09: (073w) +246.9%, 07/09: (085w) +232.6%, 10/09: (099w) +220.3%
If PS2 sales freeze, Wii sales increases needed to pass PS2 (as of Mar07, 108.4m) by...
2008: (008w) +4373.8%, 2009: (060w) +0496.5%, 2010: (112w) +0219.6%, 2011: (165w) +0116.9%
2012: (217w) +0064.9%, 2013: (269w) +0033.1%, 2014: (321w) +0011.5%, 2015: (376w) -0004.8%
At +0% it will pass it in 358w, the week ending September 19th, 2014, at an age of 409w (7y44w).
Current age of PS2: 7y37w.

Last update: Week ending November 3, 2007

Lingyis on 22 July 2007
Tetsuya said:
Dolla Dolla said:
In order to figure out if a game made profit or not, you have to know the estimated development cost plus advertisement costs. Then, knowing the sale price and the amount of copies sold, you know how much revenue was produced from the game.

The number you stated, $104,970,000 is the revenue. This is not complete profit made from the game. Retailers take a certain cut from each game they sell, the publisher has to pay shipping costs, the development team must be paid for their work, etc, etc, etc. Lots and lots of costs. So, a good chunk of the revenue is never seen by the publisher.

but the revenue is correct right??? i know they dont see that much becasue they have to cut some of that money to development costs and workers retailers and stuff right??


 the revenue is NOT correct.  104,970,000 would be closer to the GROSS, kind of like box office numbers.  retailers make money, after all!  retailers on video games i'd estimate get a 33% markup, i.e. 25% of $35 would be retailer's profit on each sale.  

 the revenue would be closer to $75 mln.



the Wii is an epidemic.

FishyJoe on 22 July 2007

I'd say the best way to know for sure is to read a company's financial reports. By law they are required to accurately report their profits. While you won't get a breakdown of individual games, it will give you an indication of the success for their product categories.