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Nintendo to post $575 million annual operating loss

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Posted by: Vito Gesualdi

Making money used to be a rather simple formula for Nintendo. Develop a decently powerful console, release a new Mario or Zelda game every few years, and try as hard as you can to remain ignorant of the ever-evolving marketplace. It's that last big that has the Big N in a bit of trouble, now forced to fend off rivals with much more capable hardware, as well as new technologies like mobile gaming or digital downloads eating into their market share.

Point is, Nintendo can't rest on their laurels any longer, with the company now posting their first ever annual operating loss. Though news of this was obviously a big wake up call to the Japanese game company, they're surely panicking now that the final numbers are being tallied, with the expected $54 million loss actually off by a factor of ten.

Nintendo actual operating loss for 2011 now is pegged at around 45 billion yen, the equivilent of $575 million USD. It seems that even the Nintendo 3DS's big holdiay rally was not enough to offset it's poor performance throughout 2011, and even The Legend of Zelda: Skyward Sword couldn't convince consumers to pick up the fledgling Wii console. 

Now to be sure, Nintendo could rally back from these losses. The 3DS is finally making an impact on the market, and the Wii U should be ready in time for 2012's holiday season. The big question is whether traditional console manufacturing is still a viable market for three seperate companies to be fighting over? And if the answer to that question is no, what does Nintendo do next?

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