Friday, 29 July 2011

Iwata Taking Pay Cut, Nintendo Losing Money

After yesterdays's announcement that Nintendo had made a loss this financial quarter, it's stock price plummeted but a whopping 21%. This was helped by the announcement of the 3DS price cut thought, so currently the price sits at around 12% lower than it was before.

Eurogamer reports, After yesterdays excitement, Nintendo held a shareholders meeting, in which company president Satoru Iwata took full responsibility for Nintendo's losses.

"I feel greatly accountable for having to make the markdown shortly after the launch, for having damaged our consumers' trust, for having made a significant impact upon the financial forecasts, for the annual dividend now being expected to be significantly less than originally expected and for now forecasting that there will be no interim dividend."

As a result, he has taken at 50% cut in his wages. Other directors will receive 30% and 20% cuts.

One thing that is highly unusual for Nintendo is that, as a result of the price cut, they now lose money on each 3DS sold. Nintendo is usually one for selling consoles at profit while other companies sell at loss and make money on games. For Nintendo to do the same shows something quite significant.

No comments:

Post a Comment