Nintendo Financial Results – 1st Quarter 2016-17 (April – June)

Today, Nintendo revealed its financials results for the First Quarter of 2016-17, and unfortunately, they’re not very good. For the first time since 2013, Nintendo actually lost money, due to a lack of major releases and the strong Yen.

Nintendo Financial Results – Raw Data

Let’s start with some raw data:

• Net Sales: 61 969 million Yen (538 million € / 591 million $ / 450 million £), a drop of 31.3% compared to Q1 2015-16 (90 223 million Yen)
• Operating income: loss of 5 134 million Yen (44 million € / 49 million $ / 37 million £), as opposed to +1 149 million Yen in Q1 2015-16
• Ordinary income: loss of 38 674 million Yen (335 million € / 369 million $ / 281 million £), as opposed to +14 286 million Yen in Q1 2015-2016
• Profit attributable to owners of parent: loss of 24 534 million Yen (213 million € / 234 million $ / 178 million £), as opposed to +8 284 million Yen in Q1 2015-16

These graphs show the proportion of Software / Hardware / Other (accesories, amiibo) in sales, but also the geographical breakdown of sales. While sales are down pretty much everywhere, Europe managed to increase its component ratio: 25.6% of total sales for Q1 2016-17 come from that region (as opposed to 23.9% during the same quarter, last year).

Nintendo Financial Results – Hardware / Software Sales

• Nintendo 3DS: 940 000 units for Q1 2016-17 (with 0 units shipped for the Pokémon + Nintendo 2DS bundles, which confirms there was just one big shipment at launch) / 59.79 million units since launch;
• Nintendo 3DS (Software): 8.47 million units for Q1 2016-17 / 282.65 million units since launch
• Wii U: 220 000 units for Q1 2016-17 / 13.02 million units since launch
• Wii U (Software): 4.68 million units / 88.72 million units since launch

Nintendo is no longer reporting Wii sales anymore.

Here’s some details about Nintendo 3DS sales:

• Nintendo 3DS XL – 19,959,000
• New Nintendo 3DS XL – 6,590,000
• Nintendo 2DS – 5,170,000
• New Nintendo 3DS – 1,920,000

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Nintendo Financial Results – Nintendo comments

In Q1 2016-17, Nintendo released several key titles on Nintendo 3DS. One of them was Kirby: Planet Robobot, and according to Nintendo, it enjoyed “steady sales”. The other two are Bravely Second: End Layer (in North America) and Fire Emblem Fates (in Europe), and both are off to “a good start”.

Unfortunately, those titles were not enough to prevent a drop of Hardware sales Year on Year, with -7% (940 000 units). Software-wise, things are a bit better: sales are up by 7% (8.47 millions).

On Wii U, Nintendo mentions the new titles (Star Fox Zero, Mario & Sonic at the Rio 2016 Olympics) and those released last year (Super Mario Maker, Splatoon), which all enjoyed steady sales. As a results, Software sales are actually up Year on Year, by 3% (4.68 million units). Hardware-wise, things are not really pretty: sales dropped by 53%, with only 220 000 units sold.

Unfortunately, amiibo sales are also down, due to the lack of new major titles compatible with them (especially one accompanied by a new range of amiibo). Nintendo sold 1.7 million amiibo cards and 1.30 million amiibo figures during Q1 2016-17.

But that’s not all: download sales are also down, due to sales of Downloadable Content not selling quite as much as last year during the same quarter.

Finally, Nintendo explains that the company was hit hard by the significant Yen appreciation. It cost them 35.8 billion Yen, which is where pretty much all ordinary losses come from (38.6 billion Yen).

Nintendo Financial Results – Forecast

For the Nintendo 3DS, Nintendo mentions Pokémon Sun and Moon, Mario Party: Star Rush, and multiple titles from third-party publishers. Once again, Nintendo’s goal is to “re-energize” the Nintendo 3DS business, and reach an even broaders audience (including kids and women).

The NX platform is still slated for a March 2017 launch (nothing new at all here). Nintendo also mentions the Pokémon GO Plus peripheral, the Nintendo Classic Mini: Nintendo Entertainment System. Regarding the mobile market, there’s the Animal Crossing and Fire Emblem titles, but no new details are available at the moment.

Forecast

Here’s the forecast for FY 2016-17:

• Net sales: 500.0 billion Yen (504 billion Yen / 4.3 billion € / 3.3 billion £ / 4.8 billion $ for 2015-16) [439 billion Yen left]
• Operating income: 45.0 billion Yen (32.8 billion Yen / 262 million € / 203 million £ / 295 million $)
• Ordinary income: 45.0 billion Yen (28.8 billion Yen / 229 million € / 178 million £ / 259 million $)
• Profit attributable to owners of parent: 35.0 billion Yen (16.5 billion Yen / 131 million € / 102 million £ / 148 million $)

As for Wii U and Nintendo 3DS:

• Nintendo 3DS: 5 million units (4.06 million units left for Nintendo to reach its target)
• Nintendo 3DS Software: 55 million units (46.53 million units left for Nintendo to reach its target)
• Wii U: 800 000 units (580 000 units left for Nintendo to reach its target)
• Wii U Software: 15 million units (10.32 million units left for Nintendo to reach its target)

Source: Nintendo