Wii U hardware becomes profitable after one game sale

Nintendo has said that it sells the Wii U console at a loss and hopes the shiny new hardware will become profitable in itself next year, but how much does it lose on each sale? Not too much, it turns out, as Wii U owners buying one single game is enough to push the whole shebang into profit.

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Nintendo has said that it sells the Wii U console at a loss and hopes the shiny new hardware will become profitable in itself next year, but how much does it lose on each sale? Not too much, it turns out, as Wii U owners buying one single game is enough to push the whole shebang into profit.

Asked by Mercury News how selling at a loss, unconventional for Nintendo, shakes things up, Nintendo of America president Reggie Fils-Aime replied, "The business model doesn't change dramatically, in that as soon as we get the consumer to buy one piece of software, then that entire transaction becomes profit positive."

He explained, "In the end, the business model is still to drive the install base of hardware, and then to drive a strong tie ratio with all of the other software and experiences for the consumer. And if we're able to do that, then we will create significant profit for the company." And of course, Nintendo plans for future hardware profitability to come from decreased manufacturing costs.

Console warriors, scrawl this fact down in your notebook for future foolish arguments.

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  • reply
    November 21, 2012 2:30 PM

    Alice O'Connor posted a new article, Wii U hardware becomes profitable after one game sale.

    Nintendo has said that it sells the Wii U console at a loss and hopes the shiny new hardware will become profitable in itself next year, but how much does it lose on each sale? Not too much, it turns out, as Wii U owners buying one single game is enough to push the whole shebang into profit.

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      November 21, 2012 3:01 PM

      Confirmed: Funky Barn saves the WiiU

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      November 21, 2012 6:00 PM

      Well, that's good. I was a bit concerned Ninty was going to blow through all their cash pushing this new system.

      Guess the "OMG NINTENDO IS GOING UNDER" crowd can save their antics for another day.

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      November 21, 2012 6:09 PM

      considering the average Wii had an attach rate of about 3 games, it's probably for the best.

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        November 21, 2012 6:23 PM

        Not true. As of March 2011
        http://www.gamasutra.com/view/feature/134719/npd_behind_the_numbers_march_2011.php?page=3

        360: 8.9
        PS3: 7.8
        Wii: 7.2

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          November 21, 2012 6:38 PM

          damn, when did that happen? I admit my '3' was hyperbole but still the last time I saw the numbers (a couple of years ago I admit) they were well behind the PS3 and the 360. Nintendo have had a quiet resurgence of game sales, or have they just not been selling consoles while still selling games?

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            November 21, 2012 7:49 PM

            I think it's always been fine. Just a little shoddy reporting to make up people's minds for them. And the idea of a silent resurgence is pretty unlikely. Given that there are a LOT of Wii's out there, you'd have to get the Wii selling 4x the total number of Wii's out there to bump it from 3 to 7+. Quick math puts Wii HW sales at ~90 million. Multiply that x4 and you'd have to have a silent sales resurgence of 360 million games. Not likely.

            Shoddy reporting http://www.joystiq.com/2008/04/23/poking-holes-in-the-new-york-timess-claims/
            Wii Sales http://en.wikipedia.org/wiki/Wii#Sales

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            November 21, 2012 8:03 PM

            Same - last time I checked they were MILES behind - it was basically a Wii Sports system - I'm sure I saw average figures around 3 as well.

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        November 21, 2012 6:27 PM

        Pretty much. Its kind of hard to justify buying the system for just a couple of exclusive games. Most of the lineup so far are ports of games you would find already on the PC/360/PS3. I haven't really seen anything outside of say Zombie U that made me even consider the system at launch. Maybe in a year or two I might buy it to buy the new Super Mario Bros/Donkey Kong/ Zelda games.

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          November 21, 2012 7:31 PM

          In all fairness most of the consoles don't have a ton of exclusives I care about...my 360 has been collecting dust since MvC3...not Ultimate MvC3...just the original (I own both...have yet to open UMvC3). I did turn it on recently to update it...but its been a long ass time. I'm not a big Halo fan and I've never gotten into Uncharted (my two PS3's get used more for Netflix than anything else these days)...so for the most part the exclusives I care about happen to be on Nintendo's platform...most of my gaming is on the PC anymore (which is where I buy cross platform games if I can).

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            November 21, 2012 8:06 PM

            The Wii library looks pretty weak when you compare it against 360 and PS3, but take away the games that are also on PC, and suddenly the Wii actually looks the most interesting from a PC gamer's perspective.

            I never bothered with a 360 or a PS3, and aside from Red Dead Redemption, I can't say I feel like I've really missed out.

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              November 21, 2012 8:11 PM

              Errrrrrrrrrrrrr
              I've said almost exactly the same sentence, except.
              "but take away the games that are also on PC, and suddenly the PS3 actually looks the most interesting from a PC gamer's perspective. "
              Because so much of the 360 games are either on PC or are very similar to PC games.

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                November 21, 2012 9:32 PM

                Nah

                Mines just a glorified Blu-ray player. I still will cross platform stuff on 360 more then PS3 if it's not out on PC.

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                  November 22, 2012 12:16 AM

                  That's because it's your primary console - this is specifically about exclusives.

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                November 21, 2012 9:51 PM

                Huh, my experience matches both sayings :P

                My PC is the main game machine, with a Wii and PS3 for their interesting exclusives. And if there's a multi-plat that isn't on PC, then I have a PS3 to take care of it.

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                  November 22, 2012 12:13 AM

                  Yeah, PS3 has good exclusives, I've said that as well. I'm just skipping the PS3, though. Got a huge Steam backlog so I don't really even want another raft of games right now. Plus I've never had a Sony console so it's not like I'm too attached to their franchises.

                  At this point I just want to see what Sony and MS bring to the table next gen. Somehow I feel like both systems are going to be more ambitious than just a simple increase in processing power.

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                  November 23, 2012 5:25 AM

                  I went with PCWii60.

                  Wii for all the Ninty exclusives that everyone should have (Zelda, SSB, MK, 3D Marios etc.)

                  360 for local multiplayer.

                  PS3 was really weak for that. Halo 3 was really the decider for me, despite never having played a Halo game at the time. And Banjo Kazooie and Kameo.

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          November 21, 2012 7:57 PM

          Yeah, as much as I like Nintendo, I'm waiting till they drop some heavy hitters before I actually go out and get a Wii U. I'm sure I'll enjoy NSMB U and Nintendo Land but they're not the kind of games you buy a system for, not at this price point anyway. Steam sales have left me with a huge backlog so it's not like I need things to play.