Nintendo Quarterly Results and Sales Data

Friday 25th January 2008, 12:00:00 AM, written by Stefan Salzl

Earlier today Nintendo published its financial results for the third quarter in FY 2007. Due to exceptionally high demand for its current products, the Kyoto-based manufacturer raised its net income projections for the current year for the third time.

In the three months ended Dec. 31, net income increased by 142.5% to 126.5 billion yen (1.11 billion USD); sales were up by 267.3 billion yen (2.34 billion USD) to 621.6 billion yen (3.1 billion USD) compared to the previous quarter.

Compared to last year, Nintendo expects its operating income to double to 460 billion yen (4.03 billion USD), while its net income is forecast to reach 275 billion yen (2.41 billion USD), up by 57.8 percent.

Driving Nintendo's strong results are its current console line-up, its handheld Nintendo DS and its home console Wii, both of which have surpassed Nintendo's original forecasts for the fiscal year. Particularly, Wii software sales have exceeded Nintendo's original expectations for the year by 53.4%.

After a slower second quarter - Nintendo DS sales decreased due to lower demand from the US and Japan, while Wii sales stagnated in Japan - Nintendo rebounded in its third quarter, ended December 31st. Even though severely supply constrained due to strong demand in all major regions, Wii sales increased by 78% during the Christmas season.  Moreover, DS sales grew by 74% compared to the previous quarter.

Overall, Nintendo's Wii life-to-date sales have reached 20.13 million units sold and are expected to reach 24.34 million at the end of March, thus passing its predecessor's sales in barely over 5 quarters (Nintendo Gamecube, life-to-date: 21.72 million units). Meanwhile, the handheld Nintendo DS has reached an installed base of 64.79 million units worldwide, with 69.78 million units forecast for March 08. Interestingly, the popularity of the portable game console will propel its installed base beyond PlayStation 2's level in Japan in the fourth quarter.

For the next few months we expect strong Wii hardware sales to continue, as the console is still heavily supply limited, especially in the US, where current demand shows no signs of a slowdown. While Nintendo's handheld, the DS, might slowly reach market saturation in the new calendar year in Japan.  Thus, we expect hardware sales to stagnate or decline in the company's domestic market. A comparison with its predecessor, the GameBoy Advance, shows that there is still a lot of room for potential sales in the US. Consequently, the Nintendo DS should undoubtedly pass the global installed base of the GameBoy Advance in the next calendar year.


Wii Dec. 06 March 07 June 07 Sept, 07 Dec. 07
Hardware




Americas 1 250 000 2 370 000 3 810 000 5 460 000 8 850 000
Japan 1 140 000 2 000 000 2 950 000 3 670 000 4 990 000
Other 800 000 1 470 000 2 510 000 4 040 000 6 300 000
Total 3 190 000 5 840 000 9 270 000 13 170 000 20 140 000






Software




Americas 9 020 000 14 490 000 23 190 000 33 490 000 60 900 000
Japan 4 330 000 6 120 000 8 900 000 11 900 000 16 830 000
Other 4 160 000 8 230 000 12 730 000 20 430 000 35 460 000
Total 17 510 000 28 840 000 44 820 000 65 820 000 113 190 000






DS




Hardware




Americas 10 180 000 11 740 000 14 140 000 16 060 000 20 180 000
Japan 14 430 000 16 020 000 18 110 000 19 710 000 21 660 000
Other 11 000 000 12 520 000 15 030 000 17 880 000 22 940 000
Total 35 610 000 40 280 000 47 280 000 53 650 000 64 780 000






Software




Americas 49 550 000 58 030 000 69 320 000 82 420 000 109 160 000
Japan 65 200 000 75 110 000 84 900 000 95 130 000 108 450 000
Other 39 490 000 50 850 000 64 030 000 81 930 000 113 250 000
Total 154 240 000 183 990 000 218 250 000 259 480 000 330 860 000







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