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Nintendo president: Expect 'Nintendo-like' profits in 2016 [Update]
Nintendo President Satoru Iwata recently acknowledged the long rebuilding process the company is mired in to become increasingly profitable again in the coming years. While unable to offer specific numbers, he toned down expectations for the coming financial year (FY 2014) as well as the next one (FY 2015) in a fiscal 2013 financial results briefing with investors, stressing that "instead of seeing a great and sudden recovery in our profitability in the next fiscal year, I am rather expecting to be able to report Nintendo-like profits from around the following fiscal year," referring to 2016. Nintendo posted a $229 million loss for the year, with Wii U estimates down 60 percent. Part of the company's expected transition involves the outlook it receives as "a video game company." Iwata believes "the intrinsic nature of entertainment is much broader than how we see it today," and that Nintendo "may be able to establish some sort of new core business if we consider our role as an entertainment company in a broader sense." While that may involve Nintendo's "quality of life" initiatives, it also relates to the company's "active utilization of character IP" as well as its expanding definition of video game platforms. It also relates to Nintendo's use of smart phones, as Iwata echoed the company's plans from January to branch into the mobile space: "Moreover, I feel that we will be able to further stimulate our platform business by taking advantage of smart devices," Iwata said. One of its first major pushes into mobile comes in the form of a Mario Kart TV companion app for Mario Kart 8, screens of which were included in Iwata's presentation, as seen above. Nintendo also recently unveiled a near-field communication (NFC) reader for the 3DS as well as plans to use the Wii U Game Pad's built-in NFC functionality with new character figurines. Update: As it turns out, Iwata was referring to the fiscal year 2015 (2016) when he spoke of the company being able to report "Nintendo-like profits from around the following fiscal year," as opposed to 2015. We've updated the language in the article to reflect this. [Image: Nintendo]
Next-gen consoles to thank for GameStop's record-breaking sales year
GameStop has the new consoles to thank for the retail juggernaut's record-breaking sales year. Total global sales reached $9.04 billion, a 1.7 increase from the previous bar-setter in 2011. The company saw a profit of $354.2 million, slamming the teeter-totter back from last year's $269.7 million loss. Sales were driven by the 29.7 percent increase in new video game hardware sales from "the launches of Microsoft's Xbox One and Sony's PlayStation 4." "The launch of new consoles in 2013 marked the return of innovation to the video game category and GameStop's market share increased to an all-time high. Our emerging digital and mobile businesses, which did not exist three years ago, surpassed $1 billion of revenue," said GameStop CEO Paul Raines. In its guidance for the 2014 year, GameStop plans to increase profits, but will close approximately two percent of its stores. The company currently states it operates over 6,600 locations, which would be a reduction of around 132 stores. Update: GameStop's financial also mentions the closure of Spawn Labs, the company's streaming service that never really got flowing. [Image: Shutterstock]
Capcom year-end results: sales up, profit down, Resident Evil 6 failed to meet projections at 4.9M
Resident Evil 6, Capcom's flagship of horrors for the fiscal year concluding March 31, 2013, certainly has "plateaued," as Capcom put it in today's results. The game, which launched in October of 2012, shipped over 4.5 million units at the time. The company announced today the game sold 4.9 million units. Comparatively, Resident Evil 5 has sold 6.1 million units. "As a result, [Resident Evil 6] did not meet with our projection," the company's statement reads. "In contrast, Dragon's Dogma became a greater-than-expected hit product in the domestic market, which has high profitability, and became an unprecedented million seller in the recent years as an original title." Overall, Capcom sales were up 14.6 percent for the year to ¥94.07 million ($950M), with net income down to ¥2.97 million ($30M), which is a decrease of 56 percent from last year. Capcom expects this year to be similar in revenues, but hopes to bring that profit back to the 2012 level. This year's line-up includes Remember Me and Lost Planet 3.
FIFA 13 sells 14.5 million in 2013, digital revenue up from FIFA 12
FIFA 13 sold through 14.5 million units in fiscal year 2013, up 30 percent compared with FIFA 12 sales from the prior year. Net revenue from digital sales hit $200 million in adjusted, non-GAAP terms, an increase of 94 percent compared with FIFA 12 year-over-year. The entire FIFA franchise generated $350 million in digital net revenue in FY 2013, including sales from FIFA Online and FIFA World Class Soccer. By Q3 2013, which ended on December 31, 2012, FIFA 13 clocked a total of 12 million sales.
Zynga sees revenues and users decline in Q1, Draw Something 2 out today
Social game publisher Zynga has revealed financial results for the first quarter of 2013. The company posted revenue of $263.5 million, a significant decline from the $320.9 million posted during the first quarter last year. Zynga saw its user numbers decline as well. Daily active, monthly active and monthly unique users fell across the board. Despite these losses, Zynga recorded a net income of $4.1 million, as compared to a $85.3 million loss during the same period last year. The company identified FarmVille 2 as "a breakout hit with daily audience engagement and bookings exceeding the company's expectations." For the second quarter, the publisher is predicting a net loss of $36.5 million to $26.5 million. Zynga posted a huge loss of over $200 million for 2012, and today's results follow a string of rocky news for the company, including high-profile departures, game shutdowns and multiple studio closures or consolidations. Earlier this year, J.P. Morgan sold the majority of its stock in the company. At the very least, Zynga is looking to keep its current stable of executives on board with the promise of larger salaries. Alongside its financials, Zynga announced that Draw Something 2 is launching today. Dan Porter, former CEO of Draw Something studio OMGPOP, left Zynga earlier this month.
Microsoft video game division turns a profit in Q3
Microsoft has announced earnings for its fiscal third quarter (ended March 31), drawing attention to the Entertainment & Devices Division (EDD), which handles products like the Xbox, Windows Phone and Surface.The EDD reported revenue of $2.53 billion, a 56 percent increase over the $1.61 billion reported during the same period last year. The company also cited a "video game deferral" of $380 million – an advance on the launch of Halo 4, according to Gamasutra – effectively lowering revenues to $2.15 billion. Even so, the EDD racked up an operating income of $342 million, up from a $242 million loss during the same period last year.Sales of Xbox 360 consoles declined, with Microsoft shipping 8.9 million units in the first nine months of fiscal 2013, down 3 million units from the same period last year. Xbox Live subscriptions rose, however, as did Xbox Live revenue. Specifically, Xbox Live membership grew 18 percent and now totals 46 million members. Microsoft did not specify how many pay for Gold memberships.
THQ's Q2 sees $107 million in net sales, needs more money for delays
THQ posted net sales of $107 million and an operating loss of $19 million in fiscal 2013's second quarter, which ended September 30. This is compared with 2012's Q2 results of $146 million in net sales, and an operating loss of $97 million.In a bid to stay afloat, in 2012 THQ has undergone corporate reshuffling, has closed studios, laid off staff, rearranged its product line and enacted a reverse stock split. THQ's most recent mainstream launch was Darksiders 2, which sold 1.4 million copies in Q2 2013. THQ CEO Brian Farrell said these sales were "below our expectations."THQ delayed South Park: The Stick of Truth, Company of Heroes 2 and Metro: Last Light today, citing a need for more time to realize the games' full potentials. This means THQ may seek more money from outside investors and through internal shake-ups in the interim, the fiscal report said."The calendar movement for the release of games will likely create a need for additional capital. THQ has engaged Centerview Partners LLC to assist the company in evaluating strategic and financing alternatives intended to improve THQ's overall liquidity, including raising additional capital, preserve the company's ability to bring the best possible games to market during the most advantageous release windows and to help address the $100 million 5% convertible senior notes due August 2014."
Resident Evil 6, Dragon's Dogma propel Capcom to record first half of fiscal 2013
Capcom reported operating income of 6.5 billion yen ($81.6 million) for the first half of its fiscal 2013 (April 1 through September 30), up 134.2 percent from last year. Overall, Capcom claimed that "sales and income for this 6 months period broke the record at all levels for the first half."The success is attributed to two games which have done better in sales than in reviews, one being Resident Evil 6, of which Capcom had already shipped 3.7 million units to retailers by the end of the half, in advance of its October release date. Yes, one of the best-selling games of the period, from Capcom's perspective, had not yet been released during the period. That's why we're always clear to identify "shipped" versus "sold," if you're playing along at home.The other big seller is Dragon's Dogma, which became a million seller in Capcom's "more profitable domestic market" of Japan despite less success outside of Japan.Capcom's social games, including a Monster Hunter card game, Resident Evil Outbreak Survive, and the Beeline games The Smurfs' Village and Snoopy's Street Fair also contributed.
Xbox division earnings down 1% compared to last year
In today's most incremental news, Microsoft reported that its Entertainment and Devices Division, responsible for the Xbox 360 and Windows Phone, earned $1.95 billion in revenue in the first quarter of its fiscal 2013, down 1% from the same period last year.1.7 million Xbox 360 consoles were sold in the quarter ending September 30. This is a 29 percent drop from last year. Microsoft expects division revenue (from Xbox, Windows Phone, Skype, and everything else the Entertainment and Devices Division manages) to continue dropping in the next quarter, but rise in "low single-digits" for the year.
Square Enix sees losses in fiscal Q1, but handheld and social games help
Square Enix faced net losses of 2.077 billion yen ($27 million) in the fiscal quarter ending June 30. The Digital Entertainment division, responsible for home and mobile video games, reported that "sales of console games were weak" in the quarter, but sales of portable games, specifically the Japan-only Dragon Quest Monsters: Terry's Wonderland 3D, were more positive.Square's mobile and social games, including the browser game Sengoku Ixa and the mobile Final Fantasy Brigade, also performed well.Back in May, the company forecasted that the fiscal year would end with net income up 48.5 percent, a forecast that it's holding to even following this slow quarter.
Take-Two's first quarter of fiscal 2013 is down and out, projections still high
Take-Two's net revenue for the first quarter of fiscal year 2013 clocked in at $226.1 million, down from the previous year's $334.4 million. Take-Two hit a gross profit of $39.4 million for the first quarter of 2013, compared to $123.2 million in the same period last year. The company's GAAP loss was $110.8 million, up from the previous financial period, which saw an $8.6 million loss.Major contributors to Take-Two's finances during the first quarter were Max Payne 3, NBA 2K12, Spec Ops: The Line and catalog sales in the Grand Theft Auto and Red Dead Redemption franchises. Catalog sales accounted for 26 percent of Take-Two's net revenue, up 50 percent year-over-year. Digital revenue grew 33 percent and accounted for 14 percent of this period's net revenue.Take-Two has adjusted its fiscal year 2013 outlook slightly, expecting $1.7 - $1.8 billion by March 2013, rather than the $1.75 - $1.85 it reported in May. Take-Two still has to launch Borderlands 2, NBA 2K13 and XCOM: Enemy Unknown this fiscal year. This leaves a probable gap of $600 - $700 million in sales, considering the year runaway hit Red Dead Redemption launched Take-Two reported just $1.45 billion in revenue.On a related note, Grand Theft Auto 5 is still categorized as "TBA" for both its platforms and launch date.
Max Payne 3 shipped 3 million, sales 'lower than anticipated'
Max Payne 3 has shipped 3 million units since its launch for Xbox 360, PS3 and PC in May, Take-Two Interactive announced in its first quarter 2013 financial report today. Max Payne 3 and Spec Ops: The Line both sold fewer copies than Take-Two anticipated, leading to first quarter results below the company's expectations, CEO Strauss Zelnick said.Still, "the outlook for our slate of upcoming releases is stronger than ever," Zelnick added. "Early consumer enthusiasm suggests robust demand for our extraordinary lineup of upcoming releases, particularly Borderlands 2, NBA 2K13 and BioShock Infinite. We continue to expect fiscal 2013 to be one of the best years in Take-Two's history."
Ubisoft sales up in last quarter thanks to Ghost Recon
Ubisoft sales for the first quarter of fiscal 2012-2013 (which ended June 30) are up 27.2 percent over the last year, coming in at €131 million ($160.6 million). The company attributes the better-than-expected performance to surprisingly high sales of Ghost Recon Future Soldier, indicating that Ubisoft didn't think to ask the title character about the future of his own game. In addition, digital distribution was a boon for Ubisoft, including free-to-play games and the phenomenon of Trials Evolution.For the second quarter, Ubisoft expects to come in short of last year's performance, because Driver: San Francisco did so well last year.
EA spending $80 million on next-gen development over next year
According to EA's results for fiscal 2012, the period from April 1, 2011 through March 31, 2012, it's been a good year. The publisher saw growth across many sectors, but perhaps most surprising was talk of investing $80 million in development of games for "Gen4 console systems" over the next 12 months, EA's fiscal 2013.It speaks to not only when we could potentially get our hands on some new hardware, but is potentially indicative of how much cash a major publisher will need in order to produce games for the next generation of AAA blockbusters. $80 million for one "Samaritan" seems like par for the course, right? That's how much we imagine it'll cost to produce one game in Superfuture 2013.
Nintendo expects to double 3DS sales by this time next year
Call it ambitious (if you're feeling nice), or potentially bananas (if you're feeling realistic), but no matter what you call it, Nintendo's clearly not joking around with its hardware sales forecast. The company let loose a variety of predictions for the current fiscal year (ending March 31, 2013) this week, which predicts movement of 18.5 million 3DS units into consumers' backpacks and purses worldwide.That's not a huge increase from the console's first fiscal year (April 1, 2011 through March 31, 2012), which saw 17.13 million 3DS units sold. And with big hitters like New Super Mario Bros. 2 and Animal Crossing on the way, it seems likely that Nintendo will surpass those numbers and get to "adjust" their forecast upwards come investor call time. "Ooops, we made way more money than we expected," Nintendo head Satoru Iwata might tell investors, with a coy smile. "Please forget about last year's major financial issues." At least that's how we picture these things going.
NVIDIA CEO sees major growth in mobile processing, quad-core tablets coming this year
During a sitdown with reporters yesterday, NVIDIA Chief Executive Jen-Hsun Huang discussed his company's near- and long-term financial outlook, while providing some insight into the chipmaker's quad-core future. According to Huang, NVIDIA expects to rake in between $4.7 and $5 billion in revenue during fiscal year 2013, with revenue from its mobile chip unit projected to mushroom tenfold by 2015, to a whopping $20 billion. Huang acknowledged that these predictions could be affected by external factors, including the ongoing patent wars between tablet and smartphone manufacturers, but didn't seem too concerned about their immediate impact. "At this point, it looks like it's much ado about nothing," he said. In fact, Huang foresees rather robust growth in the mobile processing sector, estimating that there are about 100 million devices that will need chips this year -- a figure that could soon rise to one billion, on the strength of more affordable handsets, efficient ARM processors and the rise of ultra-thin notebooks. And, despite his recent disappointment, Huang expects Android tablets to comprise a full 50 percent of the market in the near future, claiming that NVIDIA's Tegra chips can currently be found in 70 percent of all slates running Google's OS, and about half of all Android-based smartphones. In the short-term, meanwhile, NVIDIA is busy developing its quad-core mobile processors -- which, according to the exec, should appear in tablets during the third or fourth quarter of this year (quad-core smartphones, however, may be further down the road). Huang also sees room to develop wireless-enabled, Snapdragon-like processors, thanks to NVIDIA's recent acquisition of Icera, but he hasn't given up on GPUs, either, predicting that demand for graphics performance will remain stable. The loquacious CEO went on to divine that Windows 8 will support apps designed for Windows 7 (implying, perhaps, that Microsoft's Silverlight platform will play a major role in future cloud-based developments), while contending that smaller, "clamshell devices" with keyboards will ultimately win out of over the Ultrabook strategy that Intel has been pursuing. For the moment, though, Huang seems pretty comfortable with NVIDIA's position in the mobile processing market, citing only Qualcomm as primary competition. "We're the only people seriously on the dance floor with Qualcomm," he argued, adding that companies without a solid mobile strategy are "in deep turd." You can find more of Huang's insights at the source links below.
Devil's Third expected before April 2013
Previously only hinted in a slide on an investor presentation, we know have a somewhat clear idea of at least the year of release for Tomonobu Itagaki's new game, Devil's Third. "The game is currently scheduled for release in THQ's fiscal year ending March 31, 2013," according to publisher THQ's latest earnings release. Perhaps Valhalla Game Studios would be able to get the game done before then, but the kind of quality that justifies Itagaki-level boasting takes time. Besides, there are trains to build.
