Nintendo Loses $366 Million In 2012

Nintendo Loses $366 Million In 2012

For the second year in a row, Nintendo has reported a loss of 36.4 billion yen ($366 million) for its 2012 financial year.

This loss is even more severe than Nintendo’s original estimates of losing $220 million. The primary reason for the earnings gap seems to be Wii U’s poor sales performance. Global sales of Nintendo’s latest console totaled 3.45 million units, nearly 14% less than Nintendo’s initial expectations of selling 4 million units within the year.

Interestingly, the original Wii has sold 3.98 million units during the same year, surpassing Wii U by more than half million units.

Nintendo noted that Wii U’s initial sales were quite strong, but it "was not able to maintain the initial sales momentum after the beginning of 2013 due to a delay in the development of subsequent software titles." The company plans to regain that "momentum" by releasing a number of top titles during the second half of 2013.

Nintendo’s financial forecast for fiscal year 2013 expects Wii U’s total sales to reach 9 million units by the end of the year. We have to question the validity of those estimates when taking in consideration that PlayStation 4 and Xbox 720 are expected to launch during the Holidays season.