Mario Kart 8 - Luigi Death Stare

Stellar ‘Mario Kart 8’ Sales Can’t Keep Nintendo From Massive Quarterly Loss

Mario Kart 8 for the Wii U is off to a roaring success, but the game’s popularity and the Luigi Death Stare meme wasn’t enough to help Nintendo avoid a massive loss during the first quarter of its 2015 fiscal year the ended June 31. Sales of the Wii U are up as well but the 3.36 million unit sales goal for the new fiscal year may be out of reach unless upcoming titles or something else cause a mad rush for the console during the holiday season.

Nintendo announced that Mario Kart 8 sold an astounding 2.82 million copies worldwide between its May 29 launch and the end of June. That means approximately 42 percent of the 6.68 million Wii U owners purchased the latest Mushroom Kingdom kart racer.

Meanwhile, sales of the Wii U increased from 160,000 in the same quarter in 2013 to 510,000 for this year. Mario Kart 8 was clearly a system seller but the total amount of units sold is still behind the competition and Nintendo’s own sales goals.

Nintendo lost ¥9.92 billion ($97 million) in the first quarter of its fiscal year despite the massive sales Mario Kart 8 sales and the vastly improved Wii U sales. Part of this decline can be attributed to a significant drop in the Nintendo 3DS sales. The handheld sold only 82,000 during the 2015 fiscal first quarter versus 140 million units last year.

The situation was succinctly summed up by Nintendo with the following statement in its earnings release.

“The operating loss was 9.4 billion yen because total selling, general and administrative expenses including fixed expenses exceeded gross profit. Ordinary loss was 9.9 billion yen and net loss was 9.9 billion yen.”

That’s usually how operating losses happen, but Nintendo is not making any revisions to its financial forecast for the fiscal year ending March 31, 2015. In fact, it expects titles for both the Wii U and Nintendo 3DS to drive sales so that the company can meet its ¥40 billion operating income goal (via 2014 fiscal year statement) despite starting the year off in a ¥9.92 billion hole.

“For ‘Nintendo 3DS,’ ‘Super Smash Bros. for Nintendo 3DS’ will be released in September in Japan, and in October in the United States and Europe, and ‘Pokémon Omega Ruby’ and ‘Pokémon Alpha Sapphire’ will be released globally in November. In addition, a number of key titles from third-party publishers will also be released from this summer to the end of this calendar year. We expect to generate robust profits from the ‘Nintendo 3DS’ platform business.

“Regarding ‘Wii U,’ ‘Mario Kart 8,’ with a good start in sales, has contributed to a gain in momentum for the ‘Wii U’ platform business. From this summer to the end of this calendar year, we plan to release key titles such as ‘Hyrule Warriors,’ ‘BAYONETTA 2,’ ‘Captain Toad: Treasure Tracker’ and ‘Super Smash Bros. for Wii U.’ Moreover, we will launch character figures called ‘amiibo,’ which are designed to connect and interact with compatible games, in an effort to focus on measures that further stimulate the platform.”

Super Smash Bros. for the Wii U and Nintendo 3DS will undoubtedly help drive sales for both consoles along with the two Pokémon titles for the handheld, but the question is whether it can get support from the other first-party titles like Hyrule Warriors. The amiibo figures will also be an interesting test. While Skylanders and Disney Infinity both showed that companies can make good money from the sales of figures tied to game, will the market be able to support a third line? The amiibo figures will have the selling point of being able to support multiple Nintendo games though and popular characters.

Do you think Nintendo will be able to pull off its sales goals for fiscal year? Does it even matter or are you just looking forward to the upcoming lineup of Wii U and Nintendo 3DS titles? Let us know in the comments below.

[Image via Nintendo commercial]

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