Nintendo – Company Overview

Nintendo Co., Ltd. has grown to become one of the most valuable gaming, entertainment, and publishing companies in the world, with over $13 billion in annual revenue. Nintendo’s overall home and hand-held consoles have sold more than 310 million units. The company is also ranked as the “world’s fourth-largest” video game company by “Fortune”. The Nintendo Wii is a seventh-generation console that was released on November 19th, 2006, and continues to be very successful today. 

Nintendo is a consumer electronics company based in Japan. It is quite popular for the release of video game consoles to the market. Nintendo experienced a massive rebound in the last year. As a result, the popularity of the brand is increasing daily. In August, the brand was able to experience the best results out of it, where Nintendo Switch could outsell its rivals, PlayStation 4 and Xbox One in terms of sales. 

As you already know, Xbox One and PlayStation 4 are two of the most popular gaming consoles that can be found among gamers out there in the world. However, the popularity of the Nintendo Switch is increasing rapidly when compared to these two consoles. As a result, it was able to outsell the two popular leaders in gaming consoles.

It is currently Nintendo’s most profitable console ever and has sold over 101 million units worldwide since its launch, making it the best-selling console of its generation. Nintendo’s gaming portfolio spans from the Wii family of systems to the Nintendo DS family of handhelds, to a wide range of interactive entertainment formats including Nintendo GameCube games, downloadable content for select Wii and DS titles, and the Super Smash Bros. series.

History of Nintendo

Nintendo originated back in the year 1889. Up until the year 1929, it was a card company. However, the company went through massive diversification during the mid-1950s. Even though the Second World War created a major impact on the company, it was able to bounce back strongly. The contract that Nintendo established along with Walt Disney in the year 1959 contributed a lot towards its success. During the 1990s, the company could release its video game console, which is the main driving source of revenue as of now. 

Last August was not the first time where Nintendo Switch was able to outsell PlayStation 4 and Xbox One in the sale of gaming consoles. It was able to beat the two popular gaming consoles in terms of sales four times this year. The most recent event took place in August. 

The Nintendo Switch gaming console was released to the market only during March. However, it has been able to achieve tremendous popularity within a short period. Impressive features offered for the users can be considered as the main reason behind the popularity of the Nintendo Switch. The popularity of the latest gaming console of Nintendo increased along with time. It even came to a point where Nintendo could not produce enough consoles to cater to the demand. This fact indicates that even the folks at Nintendo couldn’t figure out the extent of the demand the gaming console received. 

In Japan on October 31, 2006, Nintendo Co., Ltd. announced that it would establish a new company called “Nintendo Network Services” (“NDS”) to manage its online services business based on key pillars of service expansion and new business models. The NDS was listed on the Tokyo Stock Exchange on April 5, 2007, under the “929,” symbol “9835,” with a December 30 closing date or operation date. On December 23, 2011, it was announced that Nintendo’s CEO Satoru Iwata passed away due to a bile duct growth, and the company declared a business halt. 

On May 2, 2012, Nintendo announced its new CEO as Tatsumi Kimishima with the succession of Shuntaro Furukawa as President & Representative Director. The Wii U is a video game console by Nintendo released on November 18th, 2012 as the successor to the Wii and Nintendo 3DS families of consoles. The Wii U features unique controllers called “Wii U GamePad” which contain embedded touchscreen technology that allows stylus-free control of gameplay.

Shareholders of Nintendo

Shareholders of Nintendo’s stock are known as “shareholders of record.” The total number of shareholders is unknown, but it’s been said that the number is somewhere in the teens. The “supermajority rule” is a rule set in place by Nintendo, for a company takeover. The rule states that to take over a company, one must control 90% of the company’s stock. If this happens, then the remaining 10% who don’t agree will be bought out at double or more.

On September 30th, 2006 Nintendo launched Nintendo Network Service Company (NNS Co.) to manage their network services for Nintendo DS and Wii users such as the Nintendo Wi-Fi Connection and WiiConnect24.

Competitors of Nintendo

Competitors of Nintendo’s stock include Sony Corporation (ADR) (NYSE: SNE) and Microsoft Corporation (NASDAQ: MSFT). Nintendo’s primary competitors are Sony, Microsoft, and other developers that manufacture home video game consoles. Nintendo holds the largest share (30% in 2008) of the global video game market for home consoles, largely due to their popular home console systems like Nintendo Entertainment System (NES), Super Nintendo Entertainment System (SNES), N64, Gamecube, Wii, and Wii U. According to research firm IDC, Nintendo held about 60% of the market worldwide in 2007 for handheld game consoles. Nintendo uses a modified distribution method involving retailers called “The Nintendo Seal of Quality. 

Company structure of Nintendo

The Nintendo Company is made up of five separate corporations, named after the founders of Nintendo. The companies are Nintendo Co., Ltd., Nintendo of America Inc., Nintendo Company Ltd., Nintendo Software Technology Corporation, and the Japan Art Media Group. Incorporated in 1881.

  • Nintendo EAD

This is the main branch of the company that creates all games for all platforms. They have studios all around Japan that each has different focuses on what they develop for. Some focus on home consoles while others focus on handhelds or even mobile devices. The head office is located in Kyoto, where all directors are appointed by Mr. Iwata. Nintendo EAD is also where all of the company’s latest policies and decisions get made. They also assist Nintendo in business strategy, which includes designing and producing current hardware, research and development for future hardware, and distribution of various software.

  • NCL

This is the American branch of the company that focuses primarily on home consoles and handhelds. It’s located in Redmond, WA, and has a large amount of R&D staff who develop new ideas for new products. NCL designs games for Nintendo consoles as well as other companies like Sony and Microsoft while they co-develop games with them under a licensing agreement (like Mario Kart DS with the GameCube). They also assist Nintendo in business strategy, which includes designing and producing current hardware, research, and development for future hardware, distribution of various software.

  • NSWC

This branch is responsible for all marketing plans of the company. A large portion of their work consists of creating new marketing strategies that are aimed at different demographics, then implementing them into company plans. This branch also works closely with NCL to create game ideas for both companies so that Nintendo can publish these games under their company names or still retain ownership of the game titles they will be publishing.

  • Japan Art Media Group

The JAMG acts as the main media group for Nintendo’s operations outside Japan. They manage all of Nintendo’s websites and their social network pages (for both company and gaming), handle all the marketing for those sites, as well as any other media-related submissions like news articles and videos.

  • NSMB

This group was set up to update and maintain all current sites for Nintendo products. They also update websites regularly with new content, do research for new website design and functions, and provide support to third-party companies that help create or maintain Nintendo’s social media. They also assist in the development of their software.

Other Branches: The rest of the branches are scattered throughout Japan, dealing with either production or distribution of goods, such as Pro Controllers or cable accessories. These companies are more involved in different areas of Nintendo. Many of them have various functions, while some have little to no involvement with the company.

  • Systems Administration

Most of the systems administration empire revolves around stuff like networking and server management, which includes the administration of all online services for Nintendo products. They also deal with remote maintenance on server equipment, software installation, and configuration, system diagnostics, trouble-shooting, data backup/restoration, hardware replacement, script execution (DDoS attacks), network monitoring collection, and analysis by alerting other engineers if anything unusual happens on any site’s network equipment.

Nintendo is going through ups and downs as of now 

The total hardware spending of Nintendo Switch dropped 6% during August.  In other words, they were able to reduce the cost of their gaming console production by $168 million. In the same month, Nintendo could increase their sales by 17%, which accounts for $1.7 billion. The resurgence of Nintendo can be considered as the main reason behind the hike in sales. The launch of SNES Classic Edition and the holiday season were some of the main driving forces behind the popularity of Nintendo Switch. The overall figures look promising as of now and it is expected to reach greater heights in the future. Therefore, we will be able to see record-breaking sales of Nintendo Switch by the end of this year as well. 

Another impressive fact about Nintendo is that three of its games rank within the first 10 positions among software sales. This fact shows that more people are looking forward to getting their hands on Nintendo Switch games. In the meantime, accessory sales of Nintendo Switch have also increased by 10%. Out of the Nintendo Switch games, Grand Theft Auto V is the most popular. 

The popularity of Nintendo gaming consoles

Plenty of reasons have contributed towards the popularity of the Nintendo Switch. 

  • Ability to take console games on the go 

With traditional consoles such as PlayStation 4 and Xbox One, it would not be possible for the players to engage with their favorite games on the go. That’s where Nintendo Switch comes into play. People didn’t have enough time to stay at home and play their favorite games. As a result, they wanted a portable gaming console, which can assist them to play high-end games on the go. Nintendo Switch provided that capability. Due to this reason, this gaming console became popular soon after its release. 

  • Ability to import games 

Nintendo Switch is a region-free gaming console. As a result, gamers are provided with the ability to import games as well. You don’t need to worry about the original location where games are being sold. You can simply go ahead and import that game into your console. Nintendo was indeed more stringent about this in the past. However, the time has changed everything, and the company now offers enhanced flexibility and freedom to all players. Players have also stated that this is one of the coolest features that they could experience as well. For example, you will receive the opportunity to play American games, while you are living in an Asian country. 

  • USB Type-C connectivity 

In Nintendo Switch, you will be able to find USB Type-C connectivity. Therefore, you can use a USB Type-C cable to recharge your gaming console. This would provide you with the opportunity to replace the existing cables that you have got. On the other hand, USB Type-C offers quick charging capabilities to you as well. On top of everything, the gaming console charged with USB Type-C would last for a long period.

  • Availability of first-party games 

Who doesn’t love the first party games offered along with Nintendo. Now you will be able to get your hands on it with the help of the Nintendo Switch. Nintendo has launched the Switch along with The Legend of Zelda: Breath of the Wild game. Splatoon 2 game was also released in the summer and Super Mario lovers can expect the release of Odyssey during October. Playing these games while getting a first-hand experience cannot be expected from the other popular gaming consoles available in the market. 

Due to all these reasons, Nintendo Switch can be considered the most popular gaming console available in the market as of now. It will continue its fame shortly as well.

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