It’s common knowledge that Nintendo is the only current platform holder to have made a profit from its hardware from the off, and now a number has been put on that – $6.
A report on Forbes reveals each Wii unit brings in an operating profit of $6 for Nintendo, according to David Gibson, an analyst at Macquarie Securities. By comparison, Sony loses money on each PlayStation sold, while Microsoft is currently able to break even.
Nintendo’s profits are also aided by the success of the company’s first-party titles, with the platform holder’s releases accounting for 60 per cent of Wii games sold, significantly higher than Microsoft and Sony’s share of 30 per cent and 15 per cent respectively.
The Wii’s userbase is also expected to purchase the most games this year, with a projected 220 million units outperforming targets of 120 million PS3 games and 125 million Xbox 360 titles.
Despite selling games at a lower price point and earning less in licensing fees than Microsoft and Sony, Nintendo boasts a higher gross margin on game software than its rivals, with 65 per cent compared against between 50 per cent and 60 per cent.