Nintendo expects first loss ever.

[Clownzilla]

You can think it, but it doesn't make it true. The bulk of Nintendo revenue comes from outside Japan. So, as the Yen appreciates, as it has quite a bit this year, they actually lose money. A full 2/3's of the loss is due to currency exchange. As per gamasutra "Half-year losses were 70.2 billion yen ($926.3 million), missing Nintendo July forecast of a net loss of 35 billion yen ($461.9 million) for the half-year. The strong yen amounted to exchange losses of 52.4 billion yen ($691.6 million). Sales were 215 billion yen ($2.8 billion), missing the half-year forecast of 240 billion yen ($3.2 billion)"

I'd also like to point out that Nintendo only started reporting in the 1980's. So it the first loss in 30 years, not 100.

I never said that they never reported a loss but that they have been around for over 100 years and are in a very dark place right now. Other Japanese companies are making money right now and they are subject to the same yen changes. Nintendo can't blame the yen for their crap product line when their business is struggling (I never noticed Nintendo citing the weak yen several years ago for their success). Year one price cuts and terrible system sales (for the 3DS) are not the hallmark of a healthy company. When the Wii U has the same problems as the 3DS (and it will) Nintendo is going to start to have have some serious business sustainability issues. I love Nintendo and they have a very important place in my heart but I fear that they are losing their lifelong fans (like myself) fast.

[Colorado Rockies]

You can think it, but it doesn't make it true. The bulk of Nintendo revenue comes from outside Japan. So, as the Yen appreciates, as it has quite a bit this year, they actually lose money. A full 2/3's of the loss is due to currency exchange. As per gamasutra "Half-year losses were 70.2 billion yen ($926.3 million), missing Nintendo July forecast of a net loss of 35 billion yen ($461.9 million) for the half-year. The strong yen amounted to exchange losses of 52.4 billion yen ($691.6 million). Sales were 215 billion yen ($2.8 billion), missing the half-year forecast of 240 billion yen ($3.2 billion)"

I'd also like to point out that Nintendo only started reporting in the 1980's. So it the first loss in 30 years, not 100.

The Yen has been strong before and that didn't stop them from producing a profit. The current lack of games however....

[Orion Pimpdaddy]

Don't worry, Sega took losses for years before they had to leave the console business.

[dairugger]

They shoulda just released a system that downloads from the wii shop emulated games.. with a decent controller. and add more roms,, for fair prices.
system sell for like 90 bux. and screw the handhelds.

I see so many people buy handhelds.. and only turn them on for like 5 mins then shut em off. I think people buy those just to front them.

uh, no thanks!

[Aussie2B]

The Yen has been strong before and that didn't stop them from producing a profit. The current lack of games however....

I can't speak for the entire 30 year history during which Nintendo has been reporting their profits, but for the last 10 years at least, the yen is by far stronger now than before:

http://www.xe.com/currencycharts/?fr...o=USD&view=10Y

And considering that I know Japan had some economic problems in the 90s, I doubt the yen was particularly strong then either.

[ScourDX]

The Smartphone/Tablet really steal the casual gamers away from Nintendo. Even parents these day buying kids smartphone or ipod touch.

[theclaw]

3DS has good hardware, built into a bad square-ish form factor. Tossing out its flat, stiff buttons would go far. Also ditch that glossy area surrounding the speakers / top screen. Gathers fingerprints and looks out of place with the bottom screen not having it. Etc.

[jonebone]

Currency conversion can only be to blame for the US sales, as Japenese sales would still be denominated in Yen.

As stated, it's simply because they release new handhelds like they are smartphones. Your DS is outdated within 6-12 months, and with money getting tighter nowadays, families realize that brand new versions are luxuries, and not a necessities.

The money is in software usually, so Nintendo needs to focus on that. The only 3DS game that has sold to expectations has been Zelda, and it's still just a remake. Maybe if they put out some new titles then they'll start making some money again.

[Nature Boy]

I would like to point out that the bulk of the loss was due to currency valuations/fluctuations.

Unless I misread the numbers, *ALL* of the loss was due to currency.

The article mentions they lost 20 Billion Yen (which is $264 Million).

Then it says their losses from the exchange rate alone was 'nearly $700 Million.'

Doesn't that mean that if the currency loss is taken out, they made $446 Million?

(Regardless, I'll be happy to point out to Nintendo Fan Boys that they can't say Nintendo has never lost money now, just to tick 'em off (it's not like that has ever mattered anyway))

[crazyjackcsa]

Currency conversion can only be to blame for the US sales, as Japenese sales would still be denominated in Yen.

Not true, as the U.S. dollar is the basis for international trade.

And you're all really missing the point:

Lets say you live in Japan, and have $1000 U.S. Got it? You have a grand.

Now, lets say (for fun) that's worth 10,000 yen (it isn't but it keeps the numbers easy).

Now a year later, the yen doubles in value against the U.S. Dollar.

You still have that 1k. but now it's only worth 5,000 yen.

HOLY SHIT YOU JUST LOST 5K in yen!!!!

Well, actually you didn't, but it needs to be reported as such. That issue coupled with the lower return per sale creates your loss.

[Ludwig]

The Smartphone/Tablet really steal the casual gamers away from Nintendo. Even parents these day buying kids smartphone or ipod touch.

I own that, and i still think it sucks great big hairy balls when it comes to gaming. I hope others think alike.

[Icarus Moonsight]

Not true, as the U.S. dollar is the basis for international trade.

And you're all really missing the point:

Lets say you live in Japan, and have $1000 U.S. Got it? You have a grand.

Now, lets say (for fun) that's worth 10,000 yen (it isn't but it keeps the numbers easy).

Now a year later, the yen doubles in value against the U.S. Dollar.

You still have that 1k. but now it's only worth 5,000 yen.

HOLY SHIT YOU JUST LOST 5K in yen!!!!

Well, actually you didn't, but it needs to be reported as such. That issue coupled with the lower return per sale creates your loss.

Buy that guy a beer!

This isn't a dark time for Nintendo, it's a dark time for Western Empires old and new and their bullshit currencies. If the USD were to loose it's global reserve status... Maybe I should say, when. The East would be getting pounded too right along side of us, but they have all the production so that makes their paper worth much more for that alone. Apparently Nintendo needs an Austrian consultant, or thirty. First powerpoint, Theft by the Printing Press.

[Snapple]

Yeah yeah yeah blah blah it's because of the yen.

I'm more interested in the word "ever." There hasn't been a single year previously that Nintendo lost money? There wasn't ONE year where people got tired of buying hanafuda cards in like the 1930s or something? Like, "You know I've been buying playing cards for 40 years, but I think I'll do so again this year."

That's a pretty amazing track record, honestly.


edit: Actually, you know, I'm calling BS on the "first loss ever" thing. Even if you only count years starting with Nintendo being a publicly traded company (which is 1962), according to what I'm reading the playing card market took a big downturn in the 1960s, and Nintendo stock plummeted and barely stayed afloat until Gunpei Yokoi started making toys for the company, starting in 1970.

[jonebone]

Not true, as the U.S. dollar is the basis for international trade.

And you're all really missing the point:

Lets say you live in Japan, and have $1000 U.S. Got it? You have a grand.

Now, lets say (for fun) that's worth 10,000 yen (it isn't but it keeps the numbers easy).

Now a year later, the yen doubles in value against the U.S. Dollar.

You still have that 1k. but now it's only worth 5,000 yen.

HOLY SHIT YOU JUST LOST 5K in yen!!!!

Well, actually you didn't, but it needs to be reported as such. That issue coupled with the lower return per sale creates your loss.

Maybe the dollar is the international basis of trade and for reporting, but I don't think that people walk around with dollar in their pockets over there. It's all Yen I'd assume.

So the better example would be:

You have 10,000 Yen which is worth $1k in Dollars today. A year from now it doubles in strength against the dollar. You still have 10,000 Yen, but it's worth $2k in Dollars. Your worth hasn't changed, it's just that your Yen buys twice as many Dollars as it did before.

I didn't know that foreign companies would be required to store all of their value in Dollars. Seems silly to me, and I had no idea that being a reserve currency had those kinds of implications.

Still, currency swings or not, if the currency swings are costing you millions of dollars, you're financial management staff needs to realize that and make the appropriate changes.

[Aussie2B]

I'm more interested in the word "ever." There hasn't been a single year previously that Nintendo lost money? There wasn't ONE year where people got tired of buying hanafuda cards in like the 1930s or something? Like, "You know I've been buying playing cards for 40 years, but I think I'll do so again this year."

That's a pretty amazing track record, honestly.


edit: Actually, you know, I'm calling BS on the "first loss ever" thing. Even if you only count years starting with Nintendo being a publicly traded company (which is 1962), according to what I'm reading the playing card market took a big downturn in the 1960s, and Nintendo stock plummeted and barely stayed afloat until Gunpei Yokoi started making toys for the company, starting in 1970.

Read the rest of the topic. It was already stated that it's only referring to the past 30 years in which Nintendo has been required to report their profits.

Jonebone, uh, I don't understand what's so hard to grasp about this. Nintendo doesn't store their money as US dollars within Japan, but they don't sell solely within Japan either. They do more business overseas, and when they pull that money back into Japan, it's worth less in yen than it had in the past.

[Fuyukaze]

Just glad this thread hasn't broke down to blaming Nintendo's loss on some game they didn't publish in North America as the reason. One game or eight, I fail to see that being the cause of such a massive loss.

[Baloo]

Just glad this thread hasn't broke down to blaming Nintendo's loss on some game they didn't publish in North America as the reason. One game or eight, I fail to see that being the cause of such a massive loss.

Those motherfuckers didn't release Pandora's Box or Xenoblade or The Last Story in the US. I WILL WATCH THEM FALL FOR THEIR IGNORANCE OF THEIR OWN PRODUCT THAT COULD HAVE MADE THEM MILLIONS.!!11!11!111!!!!

But in all reality, they really are in a big shitstorm right now with the fluctuating economy and the 3DS not selling as well as they hoped. But come the holiday season, I'm sure things will pick up.

Sure was a bad time for me to buy Nintendo stock back when they first came out with their earnings report...

[Icarus Moonsight]

jonebone: Nintendo held a majority of their liquid assets in USD. Hence...

[backguard]

This is the first time I seriously thought Nintendo might go the way of Sega.

[Press_Start]

So the better example would be:

You have 10,000 Yen which is worth $1k in Dollars today. A year from now it doubles in strength against the dollar. You still have 10,000 Yen, but it's worth $2k in Dollars. Your worth hasn't changed, it's just that your Yen buys twice as many Dollars as it did before.

You got it backwards. We're talking dollar to yen, not yen to dollar. Or to put in quantifiable terms:

Yen LEVEL 1.
Yen defeats Dollar Slime.....Gains 1000 EXP.
Yen LEVELS UP.
Yen defeats Dollar Slime.....Gains 500 EXP.
Yen feels sad.

Which explains why so many first-party goodies (i.e Last Story, Xenoblade) have favorably fallen to the PAL side since the Euro's 50% stronger than the US dollar in terms of the yen.