Nintendo making a loss on 3DS hardware following price drop

[phantastic91]

And it's not with the hardware, they're selling it at profit. The loss is coming from R&D/marketing, etc.

where are you getting this info from? guesswork? Why would nintendo say that they are selling at a loss when the loss is coming from R&D and marketing. that makes NO sense because it wouldn't matter what the price of the 3ds is anyways.. They need to profit on the console TO MAKE UP for the loss of R&D/marketing. according to your logic, how are they profiting and making a loss on R&D/marketing then?

I think you are influenced by a previous statement that said the 3ds costs around 100 dollars to make. that doesn't take into account licensing fees and that could probably make the 3ds cost over 170 to produce and sell.

 

[Maedhros]

And it's not with the hardware, they're selling it at profit. The loss is coming from R&D/marketing, etc.

where are you getting this info from? guesswork? Why would nintendo say that they are selling at a loss when the loss is coming from R&D and marketing. that makes NO sense because it wouldn't matter what the price of the 3ds is anyways.. They need to profit on the console TO MAKE UP for the loss of R&D/marketing. according to your logic, how are they profiting and making a loss on R&D/marketing then?

I think you are influenced by a previous statement that said the 3ds costs around 100 dollars to make. that doesn't take into account licensing fees and that could probably make the 3ds cost over 170 to produce and sell.

I was talking about the PS Vita, not the 3DS.
From Yoshida statements.

The 3DS BoM is estimated to be $108. Yeah, without fees and taxes. Nobody knows that.

 

[ShadowSoldier]

This definitely isn't the Nintendo I remember from the N64 days. I'm hoping they'll rebound. I'll support them.

 

[Chaosruler]

Even if it's lack of profit, it DOES mean that Nintendo's expectations were too high, at the very least, and they DO know why's that, I am a Nintendo fan, but reality says that the price tag was way too high and Nintendo is just starting to bleed

 

[Foxi4]

The way I see it, they're lowering the price tag to get rid of the 3DS'es cluttering the market, that way, they'll be able to empty up their own stock. Remember, they're producing the console 24/7 and they need to sell their stock to stores to actually make a profit.

Plus, the 3DS doesn't really sell well since there are only 33 games for it or so, and most of them are crap. They need to make-due until "proper" releases are out.

 

[Snailface]

The way I see it, they're lowering the price tag to get rid of the 3DS'es cluttering the market, that way, they'll be able to empty up their own stock. Remember, they're producing the console 24/7 and they need to sell their stock to stores to actually make a profit.

Plus, the 3DS doesn't really sell well since there are only 33 games for it or so, and most of them are crap. They need to make-due until "proper" releases are out.

I wonder if they'll discontinue the DSi series to help pave the way for improved 3DS sales. It would make sense because the casual gaming consumer still thinks the 3DS is basically a DSii. Forcing them to choose the 3DS by killing the DSi line would be possible now that it's the same price as a DSiXL.

 

[Foxi4]

The way I see it, they're lowering the price tag to get rid of the 3DS'es cluttering the market, that way, they'll be able to empty up their own stock. Remember, they're producing the console 24/7 and they need to sell their stock to stores to actually make a profit.

Plus, the 3DS doesn't really sell well since there are only 33 games for it or so, and most of them are crap. They need to make-due until "proper" releases are out.

I wonder if they'll discontinue the DSi series to help pave the way for improved 3DS sales. It would make sense because the casual gaming consumer still thinks the 3DS is basically a DSii. Forcing them to choose the 3DS by killing the DSi line would be possible now that it's the same price as a DSiXL.

Not until the last DS/DSi game is released they won't. They *just* stopped selling the DS Lite's - took'em a good few years. Moreover, they probably have warehouses full of DSi's that still need to be shipped.

In conclusion, the console will carry on being produced until the 3DS can stand on its own two legs.

 

[phantastic91]

And it's not with the hardware, they're selling it at profit. The loss is coming from R&D/marketing, etc.

where are you getting this info from? guesswork? Why would nintendo say that they are selling at a loss when the loss is coming from R&D and marketing. that makes NO sense because it wouldn't matter what the price of the 3ds is anyways.. They need to profit on the console TO MAKE UP for the loss of R&D/marketing. according to your logic, how are they profiting and making a loss on R&D/marketing then?

I think you are influenced by a previous statement that said the 3ds costs around 100 dollars to make. that doesn't take into account licensing fees and that could probably make the 3ds cost over 170 to produce and sell.

I was talking about the PS Vita, not the 3DS.
From Yoshida statements.

The 3DS BoM is estimated to be $108. Yeah, without fees and taxes. Nobody knows that.

edit: sorry, misread your post then

 

[Slyakin]

I wonder when, after the release of the "big" games (Super Mario 3D Land, Mario Kart 7, Kid Icarus) if Nintendo will bring the price back up... At that point, the 3DS will be leaps and bounds more successful, and the lowered price wouldn't be needed any more.

It wouldn't be like Nintendo to keep selling at a loss after the system becomes successful.

 

[phantastic91]

Personally in the long run I don't think they're making any losses

Yes, you are right. The losses that people are thinking of aren't actually the "right" losses.

The losses are in the marketing and advertising of the 3DS. If they toned that down, they could very well break even or, if they REALLY try, actually go on the plus.

Unless I'm wrong as well.

This is what my previous statement is more towards. I guess i was thinking slyakin and the other guy i misinterpreted were the same. my previous statement is directed towards you two then.

 

[Foxi4]

What people fail to see is that Nintendo can afford taking a hit when selling the hardware as long as it fuels selling the software. The 3DS is nowhere near hacked and the more units they sell, the more games they sell - each of those licensed, so they get their monnies aswell. In the long run, it's worth it.

PS3 was the same deal - Sony lost 50 bucks on each PS3 sold, but how much did they earn from games? Nobody counts that, huh?

"News" like these are complete market speculant work, aimed at lowering the stock price of Nintendo. Pure literary fiction someone makes a profit off later on.

Notice the timing. The pricedrop hits, new titles are comming in soon - obviously sales will skyrocket. Before that, we want the stock price to be as low as possible, so we send goofy info left and right. People sell their stock - you buy it. Then Nintendo blooms - you profit. It's a simple mechanism, really.

 

[Slyakin]

What people fail to see is that Nintendo can afford taking a hit when selling the hardware as long as it fuels selling the software. The 3DS is nowhere near hacked and the more units they sell, the more games they sell - each of those licensed, so they get their monnies aswell. In the long run, it's worth it.

PS3 was the same deal - Sony lost 50 bucks on each PS3 sold, but how much did they earn from games? Nobody counts that, huh?

"News" like these are complete market speculant work, aimed at lowering the stock price of Nintendo. Pure literary fiction someone makes a profit off later on.

Notice the timing. The pricedrop hits, new titles are comming in soon - obviously sales will skyrocket. Before that, we want the stock price to be as low as possible, so we send goofy info left and right. People sell their stock - you buy it. Then Nintendo blooms - you profit. It's a simple mechanism, really.

...Holy fuck.

You should run Wall Street.

 

[Foxi4]

It's not rocket science, it's just big sharks eating smaller fries that are scared of any potential monetary losses and sell their stock early. Mostly those "small fries" have no idea what a "video game" is and how the gaming industry works, they just happened to have stock that they are willing to sell cheap. Buy stock from hundreds of those fries and you get a nice profit in a matter of a year.

 

[DiscostewSM]

I wonder when, after the release of the "big" games (Super Mario 3D Land, Mario Kart 7, Kid Icarus) if Nintendo will bring the price back up... At that point, the 3DS will be leaps and bounds more successful, and the lowered price wouldn't be needed any more.

It wouldn't be like Nintendo to keep selling at a loss after the system becomes successful.

The problem with that train of thought is that not only would that mess with the consumers who were planning on getting a unit for themselves around that time, but it also messes with the distributors that are trying to sell the units. Besides, how often does a company (not a distributor in terms of doing "sales") increase their product price after lowering it?

If anything, this early price cut is just a later price cut moved far ahead of schedule, so don't expect it to be any lower for a long time.

 

[KingVamp]

Wonder if some how this will effect the Wii U price? For the better or worst?

 

[dib]

I don't need to wait for it to get any lower. The fact that there will be a 3DS Lite is inevitable. We all knew it before this one even hit shelves. And I suspect that it will be significantly redesigned as Nintendo realizes that latching onto the 3D craze was foolish, in addition to being far cheaper. And it's great to know that many of us who were suckered into being early adopters for Nintendo in the past have wizened up.