If there was ever any question as to how obscenely rich Nintendo is, the Financial Times has crunched some numbers to show the cash flow, per employee, at the House of Mario. The newspaper estimates that Nintendo produces more than $1.6 million per employee -- that's more than investment bank Goldman Sachs' $1.24 million per employee during its best year in 2007.
There are some caveats to the information, most of which revolve around how much outsourcing the Big N does. Nintendo makes so much money for having so few employees (3000 full-time), because many of the company's necessities (external development, manufacturing, public relations, etc.) are handled by outside companies. Also, don't think this means that Nintendo is compensating its full-time employees too generously. Goldman's average (by mean) employee received $660,000 in 2007, while the average salary at Nintendo was $90,900.
After getting the unfamiliar taste of profit out of its mouth, Infogrames is hungry for more. To this end, the parent of oft-addled Atari announced that it has cozied up to fellow publisher Namco Bandai to handle distribution of the latter's titles in both Europe and Asia. GI.biz writes that Infogrames' distribution activities in those regions will be consolidated as a result of the agreement, with Namco Bandai taking ownership of some 34 percent while leaving the remainder in the hands of Infogrames itself.
According to the report, Infogrames expects to find its wallet pleasantly filled with added revenue as a result of the deal thanks to added efficiency and every Economics major's favorite phrase -- economies of scale. The report further notes that Infogrames is also open to partnering with other companies over similar deals in the pursuit of greater profitability, no doubt helped when not weighed down by any pesky big budget monkeyshines.
Of course, as the saying goes, close only counts in horseshoes and things that go boom. Regardless, Wedbush Morgan's most outspoken soothsayer predicts that troubled publisher Majesco is "close to returning to profitability." Good for them, we say, though in the face of waning share prices and delisting threats, the company needs more than encouraging analyst comments to help push it to the top of Money Mountain.
Pachter bases his expectations for the publisher on tweaks made to the company's sales and cost management, as well as growth that, according to the analyst, has been managed "prudently." We'll see if the company can meet the firm's expectations of $10 million in revenue for the quarter when Majesco reports its Q3 2008 earnings on Thursday.
According to DFC intelligence figures cited by Dave Perry, Sony has lost more money on the PlayStation 3 hardware than it made on the PlayStation 2 during its five most popular years. In pure numbers speak it's lost $3 billion on the PS3, which is about equivalent to everything it made selling PS2s during its peak years. This story would actually have a lot more impact if Carl Sagan was around to say "beelyuns."
Perry, best known for his stint at Shiny Entertainment, was speaking at the really long-named Games Convention Developers Conference, which appears to be both a Convention and a Conference, and was just using the figures to underscore how much Sony was spending on hardware development. However, the 1UP article doesn't mention until near the end that the original PS2 lost money in its first year, and that Sony (and the other console makers) does this so it can make bank on the software/games that people need to fuel their systems.
In all fairness, the article goes on to explain that Microsoft lost $4 billion on the original Xbox, and has had to spend over $1 billion replacing faulty hardware in the 360 and extending the warranty for original purchasers. So, we tend to think $5 billion trumps $3 billion. The real winner in this struggle? Nintendo. It has been churning a profit on that little Wii since it hopped out of the gate. Rassin' frassin' wand-wagglin' profiteers.
We've already witnessed the news that made us go, "Wha?" -- Atari actually turned a profit this past financial quarter, even though it was just a measly $3.5 million smackers. GameDaily went a little more in-depth in their interview with brand-spanking new Atari CEO Jim Wilson to find out what the company's plan is for staying profitable and earning bigger margins, and we'll sum it up for you here: "We really, really, really hope Alone In The Dark continues to do well," and "Location, location, location!" Yup, it's trying like mad to establish a strong footing in the North American market.
The trouble with that scenario is that the most exciting Atari title we were shown at E3 was What's Cooking? With Jamie Oliver for the DS. Atari is relying heavily on N+ and Backyard Sports to make a splash... but will it be enough to keep its head out of the water? The publisher needs a huge smash that can potentially turn into a franchise to keep things rolling, or else release dozens of marginally successful titles for the DS and the Wii to make things stick.
Either way, the interview is an interesting read. While we don't want to see Atari fade into obscurity and bankruptcy again, the company has a hard row to hoe.
Grab the kids and run for the countryside, perennial loser Atari made a profit last quarter! GameDaily reports that it's nothing huge, but the company's $3.5 million profit in Q1 is quite the departure from the $11.9 million loss the same time last year. Alone in the Dark, which shipped 1.2 million copies this quarter, was apparently a strong contributor to the happy times.
Considering Atari didn't have any huge reveals at E3, it appears its projections for AitD's success need to be maintained for the rest of the fiscal year. It's good to see Harrisonet al. have the old girl up and walking again. Now let's see if they can avoid a relapse into fiscal floundering.
Developers vying for a slice of the rhythm game pie may soon find the cost to dig in to be increasing -- at least if they want players to nod along with music they know. According to Reuters, Warner Music's top exec Edgar Bronfman has come forward, stating that game companies should pay more to the music industry in order to include licensed tunes in their music-based games.
Says Bronfman, who compared the relationship to the likes of MTV or Apple's iPod, "The amount being paid to the music industry, even though their games are entirely dependent on the content we own and control, is far too small." Given Warner's interest in music currently flowing through both Guitar Hero III and Rock Band, not to mention the war that is abouttounfold on living room stages later this year, it will be interesting to see who will 5-star this game of financial tug-of-war.
After teasing its financial fortitude earlier this month, Activision continued to fill its already fat wallet during the most recent fiscal quarter, today announcing that the company more than doubled its profits to $59 million on record sales of $654 million, a 32 percent jump over the same time last year.
Unsurprisingly, both Guitar Hero: Aerosmith and On Tour played a key role in Activision's economic well-being, as did the tie-in with Dreamworks' Kung Fu Panda. Looking ahead, with Activision finally sewing up its mash-up with PC powerhouse Blizzard just weeks ago, the conglomerate now expects to report revenue of $636 million for the current quarter, and if we listen closely we can almost hear the coffers at Actilizzard bursting at the seams.
"It prints money" just isn't going to cut it anymore in conveying Nintendo's cash flow. The House of Mario announced today that in its first quarter the company brought in $993 million (+34%) in profit! Net sales were up 24% to $3.91 billion. The company sold 5.17 million Wii consoles globally (+50%) and 6.94 million DS units, which means the total lifetime sales of the units are 29.62 million and 77.54 million units for the Wii and DS, respectively.
In the software department, Mario Kart Wii drove away with 6.42 million units sold and Wii Fit continued its quest to save the Fat Princesses with 3.42 million units in people's homes -- more than likely collecting dust, along with the Bowflex and Thighmaster. Nintendo maintains its forecast of reaching a net profit of $3.04 billion and operating profit of $4.97 billion by the end of its fiscal year in March '09.
Publisher Majesco has returned from the kitchen with a piping hot plate of second quarter results. However, unlike the previous quarter's delectably sweet increases in both sales and profits, the company's second course of financials proved to be much less appetizing. For the period, Majesco announced second quarter sales of $12.8 million, down from last year's $14.6 million as well as the previous quarter's $18.7 million. Much of this decline, admits Majesco, can be blamed on the lack of key releases from company during the period, particularly from cash cows Cooking Mama and Bust-a-Move, both of which were key ingredients in Majesco's success during 2007's second quarter.
However, even with a lighter wallet, the company noted that it expects to report between $53 and $58 million in revenue for fiscal 2008. The company also took the opportunity to blow kisses at Nintendo, confirming that of its upcoming lineup this year some 59 percent will be released for the DS with the remainder "almost entirely" coming to the Wii. Jeeze, guys, get a room.
Activision had itself a very good fiscal year '08 with record revenues and its 16th year of consecutive growth. GameDaily reports the publisher's revenues hit $2.9 billion, with net income growing from $85.8 million in FY07 to $344.9 million this past year. Amazingly, the fourth quarter of FY08, which was between January and March of this year, saw no new titles released according to the publisher and still raked in $602.5 million in sales and $44.2 million in profits.
Activision has many titles to thank for its banner year, including the billion dollar franchises, Guitar Hero and Call of Duty. The publisher grew its market share from 7.2% to 17.3% and says it expects new revenues this year of $2.75 billion; that figure does not include the merger with Vivendi Games, which will create the behemoth Activision Blizzard. Activision CEO, Bobby Kotick, says the merger is still on track and the company plans to make bagiggles of cash for its stockholders in the coming year.
Nintendo announced today that it saw a 73% increase in sales this past year and profits of over $4.77 billion, which is a 115% increase over last year. It appears Nintendo forecasted conservatively and is going to need a bigger money bin. The company also states it plans to ship 25 million Wii consoles to retailers across the globe in FY09, approximately the same amount it shipped in FY08, which ended March 31. If Nintendo continues its Wii sales rampage, that means by April of 2009 there could be 50 million Wii consoles in homes.
The Nintendo DS isn't doing badly either, with 70.6 million units sold, and expected shipments of another 28 million units this fiscal year. Nintendo reveals that the global tie ratio for software on Wii is 6.07, while the DS enjoys a 5.24. The company expects an 8.8% operating profit increase in FY09 to $5.14 billion -- that's probably being conservative, again.
Majesco Entertainment's Q1 sales (period ending Jan. 31, '08) saw $18.7 million in sales and $2.7 million in profit. The publisher's got nobody to thank more than dear sweet Cooking Mama for the cash. The company saw 77% of its sales from handheld titles, like Cooking Mama 2: Dinner with Friends on DS, and made 22% off console sales, with a heavy showing by Wii titles.
Majesco CEO Jesse Sutton says the quarter was exceptional and in line with the company's plan to focus on the casual market; he continues that Cooking Mama delivered revenue increases of 47% compared to the same period last year. The company's projections have it staying the course set by this first quarter throughout the year and here's hoping Majesco can find some franchise beyond Cooking Mama and her broken English over the next year.
Nintendo tripled its operating profit forecast to ¥420 billion ($3.7 billion) for this fiscal year. This would be Nintendo's second revision this year -- they did about four upward revisions last fiscal year -- and is an 86% increase over last year's results. Nintendo also raised its software sales goal by 35% to 97 million units.
From the Japanese perspective in the Reuters report, the announcement of Monster Hunter on the Wii earlier this month is seen as a coup for Nintendo against Sony. It showed that the PlayStation franchise support may be eroding. As far as competition goes, Nintendo still holds they aren't in the same field as Xbox and PlayStation, so don't expect a price cut. Senior Managing Director Yoshihiro Mori says, "The way people play with the Wii and the type of games people play are quite different from rival offerings. The products are quite clearly differentiated ... We don't see any need to cut prices." Unless something dramatic happens, Nintendo is gonna see profits for the foreseeable future. And we still have no idea on the WiiFit impact yet.
Microsoft has just sent word that its flagship soldier Master Chief has come back from the battlefield with $170 million dollars in the first 24 hours ofHalo 3 deployment in the United States. As noted, this would mark the biggest day in US entertainment history, beating out Spider-Man 3 and all Harry Potters (of course, the price of entry for those events were a lot less, but that's a technicality when it comes to record books).
According to the press release, September 25 was also Xbox Live's most active day so far, thanks in no small part to one million online Halo 3 players. Bundled with every copy of Halo 3 was a free 48 hour trial, so we're interested in seeing how many people tomorrow decide to pay the Gold fee and keep on fragging.
We're eagerly awaiting the sales figures for the game elsewhere in the world, especially Japan.
According to DFC intelligence figures cited by 
