Nintendo Reports First-ever Annual Earning Loss With A 36.2 Percent Drop In Net Sales Revenue

Posted on Apr 26 2012 - 8:15am by Editorial Staff

The gaming company Nintendo has just released its fiscal year earning and has experience its first annual earnings loss with a 36.2 percent drop in net sales revenue from its last fiscal year due to slow sales of software and hardware in the US and Europe and the price cut of the 3DS. Overall the publisher reported a net loss of 43.2 billion yen ($532 million), which is a lower loss than expected owing primarily to a weaker than expected yen. Nintendo says it plans to cease selling the 3DS at below cost by the middle of the fiscal year ending March 31, 2013. Poor sales performance and a stronger-than-expected yen led to Nintendo revising its net sales forecast for the April 1, 2011 – March 31, 2012 period.

The net sales in the original forecast were expected to gross 790 billion yen, but this figure was later reduced to 660 billion yen in the January forecast modification. Reuters reported that Nintendo was facing an estimated 45 billion yen deficit for the business year that just ended. Analysts in the Reuters report suggest Nintendo shrink its hardware business and instead chase profits for its first-party titles although one analyst said this is unlikely to happen unless the upcoming Wii U console is shown to be a clear failure. Its outlook also includes the release of New Super Mario Bros. 2 this August with a version for the 3DS, and the release of its high-definition console, Wii U. The Wii U is expected to be released in the fourth quarter of 2012.

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