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Though consoles like the Xbox 360 and PlayStation 3 are content to sell their consoles at a loss for a while as hardware prices come down (and software sales pick up the slack), Nintendo is not ready to make such a concession. Tech company UBM TechInsights has recently torn apart a 3DS unit and estimates the components cost about $101 to produce. The 3DS is $250.  Of course, you have to factor in the price of marketing, shipping, packaging, research and development, and retail share into the final cost, but still, even if you factor in an extra $100 for these things (which is VERY generous), Nintendo is still making a $49 profit. But that’s really conservative. I suppose now would be a good time to buy stock as Nintendo handhelds do have a way of generating ridiculous profits for Nintendo, even when they aren’t marked up more than 50% over hardware. |