Nintendo President and CEO Satoru Iwata is taking a self-imposed 50-percent pay cut for the next five months following Nintendo’s recent economic downturn, according to a report from the AP. Other members on Nintendo’s board will also take a pay cut of 20 to 30-percent. Iwata and the board will re-examine the question of salary in June and determine how to proceed then.
Nintendo recently announced a 30-percent drop in its nine-month profits, mostly due to poor demand for Nintendo’s Wii U.
Earlier this month, Nintendo changed its annual forecast from an expected $500 million in profit, to a loss of $240 million. Nintendo originally forecast 9 million Wii Us would be sold in 2013, but in reality it sold just 2.8 million. By comparison, both the PlayStation 4 and Xbox One outsold the Wii U since their November launches. Microsoft has released its quarterly numbers and reports that the Xbox One shipped 3.9 million units; Sony won’t release its official numbers until February 6, but the PlayStation 4 is said to have sold around 4.2 million worldwide.
As a result, Nintendo’s stock fell 12-percent since it announced that it would report a loss. Following the announcement, Iwata took much of the blame onto himself, claiming “my duty, more than anything else, is to revive our business momentum.”
Iwata began his career as a programmer with HAL Laboratories in 1982, a subsidiary of Nintendo. He earned a reputation for his programming abilities, and just over a year later he became the company’s coordinator of software production. In 1993, he was named president of HAL, a position he held until 2000, when he joined Nintendo. In 2002, at the age of 42, he was named Nintendo’s president and CEO, becoming only the fourth person to hold that title since Nintendo was founded in 1889.
Iwata will meet with analysts and board members this week to discuss other possible business models. Nintendo also announced this week that it would buy back around 8-percent of its stock.
