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Wii U: Nintendo 'Got It Wrong With This Console' - Pachter

David Lynch

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Industry analyst Michael Pachter believes Nintendo 'got it wrong' and will have to cut the price of the Wii U to keep hardware sales up.

Published on Jan 30, 2013

Nintendo’s third quarter financial results and Wii U sales forecast cutting is evidence that the Wii U ‘doesn’t capture the imagination’ of the Wii, according to analyst Michael Pachter.

As Nintendo releases its third quarter financial results for 2012-2013, it has had to cut its Wii U sales forecast and industry analyst Michael Pachter believes this is evidence that Nintendo has miscalculated with its new console.

“I always thought Nintendo’s Wii U software forecast made no sense,” explains the Wedbush Securities analyst of Nintendo’s financial results.

“They initially guided 24 million, are taking that down to 16 million, which is a 4:1 software attach rate. That’s reasonable, especially given that the installed base is 3 million hardware units now and the guidance implies they need to ship only 4.31 million more software units.”
 
But Pachter goes as far to say that the disappointing hardware sales won’t be relieved unless Nintendo cuts the price of the Wii U.

“The hardware guidance is disappointing, and there isn’t really anything that will get hardware moving other than a price cut. I think they got it wrong with this console, it just doesn’t capture the imagination the way that the Wii did.”

Unsurprisingly, Pachter’s not optimistic when it comes to the future of Nintendo’s Wii U, especially when Microsoft and Sony’s new consoles arrive on the scene, and he paints a bleak picture.

“The Wii U is not going to be very competitive if Sony and Microsoft launch comparable consoles at comparable prices,” explained Pachter.  
“The early weakness will cause many third party publishers to re-think support for the Wii U, and we might not see much support at holiday 2013.”

 

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