Nintendo hasn't yet announced the price of its next console, codenamed the NX, but the company recently indicated that it does not intend to take a loss with each sale.
"We are not thinking of launching the hardware at a loss," said Nintendo president Tatsumi Kimishima during an investor meeting last week. "Selling at a loss at launch would not support the business."
Kimishima added that Nintendo is developing the NX hardware with that mission in mind, suggesting that the company is looking to keep costs down for the console's components and manufacturing process.
Historically, Nintendo priced its hardware to make a profit, even at launch. That's the opposite of the strategy employed by Sony and Microsoft, which usually take a loss on hardware sales and hope to make it up in software. However, that changed with the debut of the Wii U in fall 2012. The strength of the Japanese yen at the time was a major factor in Nintendo's decision to launch the Wii U at a loss, and it took until the spring of 2014 for the company to make money with each Wii U sale.
"Selling at a loss at launch would not support the business"
Kimishima also responded to comments about Nintendo's decision to launch the NX next March, when it seemed like the company had planned to release the console this year. One investor pointed out that Nintendo's two previous presidents noted the importance of launching before the holiday season — Hiroshi Yamauchi with the GameCube (which arrived in November 2001), and Satoru Iwata with the Nintendo 3DS (which missed the window, launching in early 2011).
Launching the NX in March 2017 doesn't mean that Nintendo no longer believes that the holiday season matters, said Kimishima. Instead, one of the major factors in the timing is ensuring that the console has a sufficient launch lineup.
"We believe that when launching hardware, the amount of quality software for consumers to play that is available at launch is important, and that we ought to determine our launch dates based on this," said Kimishima. "In that sense, our approach is that we should wait until we can provide a fully realized experience rather than rushing to launch in the holiday season."
A new Legend of Zelda game is in development for NX; the title will be released simultaneously on both Wii U and NX in 2017, just like The Legend of Zelda: Twilight Princess debuted on both GameCube and Wii in late 2006. Nintendo will not show the NX at E3 2016; instead, the company plans to reveal the hardware later this year.