Ever since Nintendo posted its first annual net loss in early 2012, the Japanese gaming company (whose North American headquarters is right here in Redmond) has seen a steady decline in its fortunes. Earlier this year Nintendo announced a $228 million loss for 2013, and last week the company revealed it will be closing their European headquarters in Germany, laying off 130.

Although these operating losses and cutbacks are a recent development, sales of Nintendo home consoles have actually been shrinking ever since the days of the NES in the ’80s. The Wii was a dramatic fluke in a decades-long decline:

Nintendo Home Consoles: Sales per Year

With just shy of 62 million sales in its nearly ten-year lifetime, the Nintendo Entertainment System held the title of best-selling Nintendo home console through four generations. The Super Nintendo, Nintendo 64, and GameCube all failed to live up to the glory of the NES. That all changed with the release of the Wii in 2006. With its unique motion controls and approachable library of games, the Wii very nearly sold more than the combined total of all three of the consoles that preceded it.

While the Wii U is off to a slow start, it’s not actually selling that much slower than the GameCube, which was making Nintendo plenty of money. In terms of raw sales, Nintendo doesn’t need another Wii, it just needs the Wii U to inch past the GameCube.

When it comes to handhelds, the 3DS is actually their second-best-selling system:

Nintendo Handhelds: Sales per Year

There has been a near non-stop flood of articles in the gaming press this year lamenting Nintendo’s mounting financial losses, and no shortage of turnaround suggestions from the peanut gallery…

Today at E3 we get to see if Nintendo has a plan of their own to reverse the tide. Will they announce something dramatic like a cross-platform gaming subscription service for all their legacy titles (i.e. the “Netflix of classic Nintendo games”), or will their E3 presentation be more of the same little incremental moves?

My opinion as a Nintendo fan since the glory days of the NES? Nintendo should focus on what they have always done better than anyone: making awesome games.

With Mario Kart 8, Donkey Kong Country: Tropical Freeze, Super Mario 3D World, Pikmin 3, and upcoming titles like Yarn Yoshi and Super Smash Bros., the Wii U is finally starting to build an enticing library. The release of Mario Kart 8 shot sales of the Wii U up from 31 thousand the previous week to over 187 thousand last week. A few more “system-sellers” like that could be all that it takes to get them back on track.

Nintendo will almost certainly never sell as many Wii U consoles as they did of the Wii, but they don’t need to. They just need to make enough great games to get back into the black so they can continue to make even more great games for many years to come.

Comments

  • GTZ

    Their sales haven’t declined for the past 10 years.. maybe 2 yr max for the handheld business, as we all know, zelda and pokemon alone keep it afloat and healthy.

  • Dave

    They would need a radical change focused on games only not hardware + games. Casual and kids games are now largely on iPads and iPods, particularly since an iPod touch costs only slighty more than a ds and has much broader utility with movies, shows, etc. For those users, the days of $30-50 games are also gone. The quality of most of the $5-10 iPad games is well above the Nintendo games for their devices. Consoles are now more expensive and for games not as much on casual users. Hard to see Nintendo remaking that niche again.

    • DecoyOctorok

      “The quality of most of the $5-10 iPad games is well above the Nintendo games for their devices.”

      Stopped reading there. That’s not even an opinion; that’s just an objectively incorrect statement. Good lord.

      • Dave

        Sorry, I was referring to the DS/3DS games not the consoles. Their small screen games are remarkably mediocre and massively over priced. You simply don’t see kids with them anymore.

        • DecoyOctorok

          I’d still argue that the quality of 3DS games like Super Mario 3D Land, A Link Between Worlds, Pokemon X/Y, and Bravely Default are well beyond what you’ll find available on mobile devices though. I agree that we are starting to see a shift in the preferences of younger players but the 3DS remains a pretty strong seller.

          • Dave

            I understand your point but as a parent, I just don’t see 3DS or DS anymore. You used to get on a plane and see all kids with them. Now, rarely if ever. The devices are too single threaded, the games are too expensive and from my perspective the games aren’t that good.

            I don’t underestimate the Nintendo games but they are anachronistic at this point. Simply not modern, not fast enough, not good enough in the current world for childrens games and way off the mark for adult games. My kids and I would rather play FIFA or Madden on the Apple devices than on the DS or 3DS. And the Apple devices can store some shows or movies to watch as well. For a fraction of the cost versus buying Nintendo games.

          • DecoyOctorok

            I can definitely understand that from a parent’s perspective. The iPad will be coming with you anyway so it makes for a decent all in one entertainment device.

            Personally I can’t stand touchscreen controls and I think that’s the main thing holding back mobile games for me. Graphically they look near console quality, but the gameplay is limited by the touch interface. The Infinity Blade series is a good example of this. Those games look gorgeous but the actual gameplay is essentially a more complex version of Punch-Out.

  • http://timandjeni.com/ Timothy Ellis

    I included the chart so you don’t have to take my word for it. The Wii was a fluke. Sales of Nintendo home consoles had been declining consistently since the success of the NES, which was discontinued in 1995. The Wii U Just picked up that trend almost exactly where it was left off before the Wii. 1995 – 2014 = decades.

    • DecoyOctorok

      These numbers should be taken with a grain of salt though. The industry was far smaller in the NES and SNES days and there was much less competition. The NES had a near monopoly in the west and the SNES’s only real competition was the Genesis/Mega Drive.

      • http://timandjeni.com/ Timothy Ellis

        So they sold more consoles when the industry was smaller… That makes the decrease seem even worse.

        • DecoyOctorok

          Not really. It just means that the industry grew and things started to change pretty rapidly beginning with the 32-bit era. Consumers started to have more options to choose from.

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