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Thursday, May 7, 2015

Nintendo's full year financial results show gains, but it's not all rosy yet


Nintendo, despite struggling with the Nintendo Wii U, has announced gains to its operating income for the full financial year.

According to its results, published today, Nintendo's operating income was 24.7 billion yen, on the back of net sales of 549.7 billion yen. Thanks to foreign exchange gains totaling 34.0 billion yen due to the depreciation of the yen against the U.S. dollar when compared to the previous fiscal year, Nintendo's ordinary income was 70.5 billion, and its net income was 41.8 billion yen.

This is a significant turnaround in terms of income, given that in 2014 Nintendo reported an operating income of -46.4 billion yen. However, the company continues to show challenges. Sales actually declined in the 2015 financial year compared to 2014, which was itself a decline on the 2013 levels (the 549.7 billion yen in sales was a decline from 571.7 billion in 2014). In the financial statement, Nintendo attributes this to slower than expected sales of the original 3DS model, as well as the continued sluggish movement of the Wii U.

"During the fiscal year ended March 31, 2015, for "Nintendo 3DS (3DS, 3DS XL, 2DS, New Nintendo 3DS and New Nintendo 3DS XL)," "New Nintendo 3DS/New Nintendo 3DS XL," launched as the newest members of the "Nintendo 3DS" family, got off to a good start and continued to sell well, while the sales of the "Nintendo 3DS" hardware prior to the launch of "New Nintendo 3DS/New Nintendo 3DS XL" did not grow as anticipated" the Nintendo report states.

"With respect to "Wii U," Nintendo released two hit titles, "Mario Kart 8" and "Super Smash Bros. for Wii U," which enjoyed robust sales of 5.11 million units and 3.65 million units respectively. These titles continued to perform well especially overseas, and the global sales of the "Wii U" hardware and software reached 3.38 million and 24.40 million units respectively."

Looking forward to the 2016 financial year, Nintendo is hoping to maintain or increase demand for both the Wii U and Nintendo 3DS with a combination of amiibo support and a range of games (that we already know about, from Fire Emblem to Splatoon and Mario Maker) for both consoles. It's also expecting the partnership with DeNA to produce mobile games using Nintendo IP to start generating income.

The company is projecting net sales of 570.0 billion yen, and an operating income of 50.0 billion yen across the 2016 financial year. It's notable that this projection would still mean lower sales for the company than it experienced in 2014.

- Matt S. 
Editor-in-Chief
Find me on Twitter: @digitallydownld
Nintendo's full year financial results show gains, but it's not all rosy yet
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