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Nintendo Gaming / RE:New North American (NPD) Sales Thread
« on: October 21, 2004, 06:22:20 PM »Quote
Originally posted by: ruby_onixQuote
Do you have any numbers to back this up?
Do you know what percentage of Nintendo's profits come from the gamecube sales, versus the GBA?
Here's a general rule of thumb.
The most recent "installed base" and "tie ratio" numbers mentioned in this thread (from July) are:
Cumulative Installed Base
PS2: 24,433,000
Xbox: 9,367,000
GCN: 7,672,000
GBA: 22,579,000
LTD Tie Ratios
PS2: 8.52
Xbox: 7.01
GCN: 6.68
GBA: 3.67
On a modern console game, the hardware maker earns about $10 from royalties. I think the GBA earns less than that, and "greatest hits" titles also earn less, but $10 is just a convenient ballpark number.
So looking at the tie ratios, Sony has made $85 on every PS2. But Sony typically sells their hardware (both PSone and PS2) at roughly a $50 loss (Sony will never give us an exact number on that, but it's "heavily rumored"). So Sony has essentially only made $35 on every PS2.
Microsoft has made $70 per-XBox in royalties, but they're said to lose $100 on the hardware, so they're down $30 for every XBox.
Nintendo has said that at the time of price drops, they lose "single digit" (less that $10) money on the hardware. The rest of the time, they're making small amounts of money on it, so lets just say they're breaking even. So Nintendo makes $67 on each GameCube.
The GBA (like the Cube and the N64) isn't sold at a loss, so it gets $37.
So, multiplied by the "installed base" numbers, the PS2 has earned $855 million in America. The XBox has lost $281 million. The GameCube has earned $514 million. And the GBA has earned $835 million.
These are clearly rough numbers, but you can see how Nintendo earns a fortune on their console hardware, and how the handheld market (although earning Nintendo another fortune) is not as "lucrative" as everyone seems to think, right?
About a year or two ago, Rick Powers got his hands on a detailed financial rundown, and he couldn't tell us the specifics (because the report costs several thousand dollars), but he said that (on a purely "hardware" level) the GBA and PS2 were earning roughly the same amount of money, and that the GameCube was earning more than either of them.
Wow, I never knew before that Sony and Nintendo sold thier systems at a loss as well, and that they simply make back the money they lose on the hardware by collecting royalties on games. In that case Nintendo must do very well, since something like seven of the top ten best sellers on the Gamecube were developed in house at Nintendo (meaning they make a lot more than just $10 on each of those games sold).
