A historical analysis of Nintendo

If you only read one business article on Nintendo this year, read this one. Author Geoff Gannon sets the record straight and has put together one of the best financial studies of Nintendo from an investor perspective that I’ve ever read, and it’s got sales numbers to boot. Interesting to note that while Nintendo’s hardware market share has been declining for more than a decade, games sold per console has actually increased, the most being for GameCube with an average of nine games purchased per system.

Some additional information tidbits:

  • Americans make up 58% of total GameCube ownership (21 million).
  • Investors believe the console war will be a “much closer race” this time.
  • Nintendo surpasses Electronic Arts (the world’s largest game publisher) in sales, earnings, and market cap.
  • Wii is turning a lot of heads in the business market.
  • Nintendo has more in common with companies like Disney and Lucasfilm than it does with manufacturers of consumer electronics (e.g. “in the vault” strategy: waiting eight years to release new Metroid game between 1994 and 2002 resulting in sales success).

From the article: “Nintendo is the only company among the three console makers that began life as an entertainment company, and it shows. Microsoft is known for software; Sony is known for hardware; and Nintendo is known for games.”

[via ChaCha]