Nintendo reports its first profitable year since 2011

By Kris Wouk May 7, 2015

nintendo nx mobile games e3 2015 stale ideas for reinvention — Image used with permission by copyright holder

Despite its valuable brand, Nintendo has had a rough few years. The Wii U hasn’t sold nearly as well as its predecessor, and while the Nintendo 3DS and now New Nintendo 3DS are good sellers, that hasn’t been enough to keep the company from reporting annual losses. Until now, that is.

For the first time since 2011, Nintendo has announced a profit. Specifically, it saw a ¥41 billion ($350 million) profit for the last fiscal year ending March 31. This stands in stark contrast to last year, which saw losses of ¥23 billion ($193 million).

Worldwide sales of the Nintendo 3DS family reached 8.7 million units in the last year. The New Nintendo 3DS and New Nintendo 3DS XL “got off to a good start and continued to sell well,” according to Nintendo’s latest financial report (PDF link). Despite good sales, sales of older models in the 3DS family “did not grow as anticipated.”

Looking at game sales, Pokémon Omega Ruby / Pokémon Alpha Sapphire sold 9.94 million units, while Super Smash Bros. for Nintendo 3DS sold 6.75 million units. Tomodachi Life, Mario Kart 7, and The Legend of Zelda: Majora’s Mask 3D each sold more than 2 million units.

The Wii U didn’t sell nearly as well as the 3DS at 3.38 million units, though games for the system sold well. Mario Kart 8 and Super Smash Bros. for Wii U sold 5.11 and 3.65 million units respectively. Combined sales of Wii U software totaled 24.40 million units.

Wii U sales are still lagging well behind the original Wii. As of March 31, it had only sold just over 9.5 million units worldwide, while the Wii has sold over 100 million (PDF link).

Looking toward the next fiscal year, Nintendo expects to make a profit of ¥35 billion ($293 million). The company is expecting its deal with DeNA to sell smartphone games to be a nice new source of revenue, and expects new Amiibo cards and yarn-knitted Amiibo figures to increase Amiibo sales.

Nintendo also has other plans for diversification in the works. Today it announced that it will bring Nintendo-themed rides and attractions to Universal theme parks.

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Kris Wouk is a tech writer, gadget reviewer, blogger, and whatever it's called when someone makes videos for the web. In his…

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More significant Wii U games and a handful of 3DS titles were ported to Switch, but many titles are still stuck on those systems and can’t be ported. Once the digital storefront shutdowns, digital-only titles will be gone forever, and physical copies of these titles will get more expensive and harder to experience. Fans and game preservationists have not been pleased by this decision, with the Video Game History Foundation giving the most candid response.
https://twitter.com/GameHistoryOrg/status/1494398068346654720
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Why is Nintendo shutting down the 3DS and Wii eShops?
Officially, Nintendo’s FAQ on the eShop closures says “this is part of the natural life cycle for any product line as it becomes less used by consumers over time." The answer doesn’t get into specifics and might confuse those still playing games on the system or fans of games only available on Wii U or 3DS. Omdia Principal Analyst Matthew Bailey explains Nintendo’s user base argument in more detail, highlighting the massive gap between the number of people playing the Switch as opposed to the Wii U.
“While Omdia expects the number of Switch consoles in active use to exceed 90 million on a global basis this year, the Wii U’s global active installed base will drop under one million in 2022,” he explains. “Even when you include the more enduring 3DS family of consoles into the equation, the Switch still comfortably accounts for over 90% of Nintendo’s total active console install base.”
If one is going off just the numbers, it’s sensible that Nintendo would want to focus on the majority of its players. Bailey admits that “Switch users are already reaping the benefits of Nintendo’s singular first-party development focus on one platform.” Still, one might argue that Nintendo should just let the eShops remain up even if it isn’t actively updating or maintaining them.

Unfortunately, Nintendo doesn’t see that as possible due to cost and security issues. Game Over Thrity, a Twitter user with over 20 years of experience working on IT projects and infrastructure, shed some light on what might have influenced Nintendo’s decision-making in a thread.
“As these systems age, they require patches, security, special contracts, updates, and personnel that know how they were built (and maintained),” his Twitter thread explains. “As time goes on, there are security holes, servers, code, infrastructure, etc., that can’t be brought up to modern standards. It becomes a constant struggle between maintaining legacy systems, paying people to do so, and trying to keep up with global regulations. It’s not cheap by any means. They can’t just ‘leave the lights on’ and stop supporting them. What if someone hacked the payment processor?”
With every passing year, the Wii U and 3DS eShops likely became more expensive to maintain and an increased security risk for the video game publisher. Instead of investing the time and resources into pleasing a smaller amount of players, the easier option is to turn everything off entirely. While he isn’t affiliated with Nintendo, Game Over Thirty’s assessment aligns with what we’ve heard from Nintendo and Omdia.
"The Wii U’s global active installed base will drop under one million in 2022."