Nintendo Braces For First Annual Loss In 30 Years

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Well, Nintendo issued its report for the first half of its fiscal year, and as expected, the results weren’t that great. It wasn’t as bad as Japanese newspaper Nikkei was predicting, but Nintendo was still hit with massive losses in the first half of fiscal year 2011. Head past the break for all the details.

Nintendo’s expected losses for the half ending September 30th were actually doubled, going from ¥35 billion ($463 million) to ¥70.2 billion ($926 million). In the days before the report, Nikkei was predicting that we could see losses as great as ¥100 billion ($1.32 billion), but Nintendo was able to slide just under that prediction.

Still, ¥70.2 billion isn’t any kind of chump change, and it has Nintendo gearing up to report its first annual loss in the 30 years it has been in the video game industry. Originally, Nintendo was actually predicting an annual profit of ¥20 billion, but they’ve since changed that forecast to a loss of ¥20 billion.

Nintendo primarily blamed the loss on the lack of software for the Wii and 3DS, the price reductions of their hardware in overseas regions, and the yen, which is currently stronger than the US dollar. Since Nintendo makes 80% of its money in America and Europe, the strengthening yen means that they lose a lot of profits in foreign exchange rates.

The situation isn’t good by any means, but it doesn’t mean that Nintendo is down for the count just yet. With the recent price cut on the 3DS, Nintendo is probably in for a strong holiday season, and with next year’s release of the Wii U, Nintendo may indeed bounce back in 2012. In the mean time, we’re simply going to have to wait and see how the 3DS performs when it has some notable first party releases to support it.

What do you think of these numbers? Do you think Nintendo is in trouble after announcing their first annual loss in 30 years? Do you think they’ll be able to bounce back with the Wii U, or will it be a flop? Head down to the comments section and give us your take!