In a briefing of financial results held today, Nintendo president Satoru Iwata gave a presentation outlining the reasons why the company's third quarter earnings took a hit and what it plans to do to return to "Nintendo-like" profits again.
Iwata said Nintendo performed well in its domestic market of Japan, but its performance in the U.S. in 2012 was partly to blame for its lower-than-expected earnings. Citing a list of the top 20 games sold in the last calendar year in the U.S. Iwata said Nintendo performed the least favorably, to the point where the downward revision of its financial forecast "is largely attributed to the slow growth in the U.S. sales." Of the 20 titles on the list, only five were for Nintendo platforms.
Games that performed well in Japan like Animal Crossing: New Leaf were not released in the U.S. in 2012, which Iwata says created a "chicken-and-egg problem" where hardware and software sales didn't drive each other and consumers had little incentive to buy hardware because there wasn't enough diverse software available. Iwata said this problem will be addressed in 2013 with the announcement of games like Monster Hunter 4 and Pokémon X/Y.
"... change the Nintendo 3DS system from a handheld device just to play the Mario series to the one to enjoy a variety of games."
In addition to the above titles, Fire Emblem Awakening, Pokémon Mystery Dungeon: Gates to Infinity, Luigi's Mansion: Dark Moon, Brain Age: Concentration Training and LEGO City Undercover: The Chase Begins have already been announced for the first half of this year. "We plan to intensively and actively sell approximately 10 titles on our own in order to change the Nintendo 3DS system from a handheld device just to play the Mario series to the one to enjoy a variety of games," Iwata said.
Iwata also spoke of plans to bring third-party titles developed in and have had success in Japan to Europe and the U.S. "Among those third-party titles both developed and published in Japan, there have been some games which Nintendo published in Europe, including the Professor Layton series," he said. "We will increase the number of such games for the U.S. market as well as in Europe. We are also willing to flexibly assist third-party developers in distributing their valuable games overseas."
During the presentation Iwata also addressed the Wii U's pricing and said that there are no plans for a price cut because the console is already sold at below manufacturing cost.
"We are putting our lessons from Nintendo 3DS to good use," he said. "However, given that it has now become clear that we have not yet fully communicated the value of our product, we will try to do so before the software lineup is enhanced and at the same time work to enrich the software lineup, which could make consumers understand the appeal of Wii U."
The full presentation where Iwata talks about Nintendo's performance in various markets can be viewed here.
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