Derived charts say Nintendo profited for 9 years
How is a winner in the console race determined? By the number of consoles companies have sold? Or by how much the console company made? If money does the talking for you, then you’re probably in for a shock. Sony may have led the console race last generation in terms of hardware install base, but guess who made the most money (and on the operating income level, we must add)? That’s right: Nintendo – if the calculations of Justin of Gamerinvestments.com is accurate and factual.
Justin of Gamerinvestments.com, a shareholder of both Sony and Nintendo, claims that Nintendo racked up more cash than Sony in last the console generation’s “race.” For the five years that Nintendo participated in the last generation’s market grabbing, it garnered the most in operating income: approximately US$ 4.59 billion dollars.
Justin derived his figures from NPD data, a historically accurate rundown of exchange rate for the past years (listed on X-rates.com), conversion procedures of unlike fiscal years, and data only related to the game divisions of the conglomerate companies (Sony, Microsoft).
The calculations have also taken to account the time when the console race began.
If the charts do tell anything, it shows that even while the PlayStation 2 had a two year jump-start and lasted longer than four years, Nintendo managed to profit most out of the last console generation. And for businessmen, investors, and the game industry’s top brass, the company who keeps on ticking is the same company that keeps on bringing the cha-ching.
Well, Nintendo definitely brings the cha-ching. And why wouldn’t they? Business buffs pointed out that by spending less than US$ 15 on a Wii remote, they’re shoveling in plenty of dough.
Granted that the US$ 1.5 billion gap between Sony and Nintendo’s operating incomes is ominously large, it only represents the difference in both company’s EBIT (Earnings Before Interest and Taxes), however, and could result in different net earnings.
Also consider that there’s still more years that the Sony PlayStation 2 continued to garner more customers, well into the years the next-generation console race began. Unfortunately, due to the parameters involved in determining when last generation’s console race started, those years cannot be counted.
Now though Microsoft’s operating income might be alarming for the same period (they did spend to overtake Nintendo’s GameCube, as well as try to make the Xbox a household name for consoles for the next generation), take note that negatives are not rare after deducting operating expenses. Microsoft’s gaming division is also a part of one (big-ass) machine at Redmond, and the company as a whole had more to profit elsewhere.
The status for the next-generation console race (arguably, the current generation console race now) stands at the following: Nintendo is leading in hardware install base by 24 million Wiis, while Microsoft is sitting on second place with 19 million Xbox 360s. Sony’s PlayStation 3 finishes last at 12.85 million consoles cashed from the counter.
But who’s going to earn the most from this generation? Fortune had the inkling before, and when it comes to business, the corporate magazine is probably right on the money. Head on over to the source provided below for an eye opener.
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