Name: How Nintendo Makes Billions
Uploaded: 2026-03-05T17:42:12.000Z
Duration: 9 min 20 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

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Nintendo in the world of video games is quite known for risk taking.

This kind of attitude helped them through the last decades.

The company is always focused on bringing something new to the table.

They don't really look too much at trends.

They've had these incredible ups and incredible downs, but

they never seem to really lose sight of who they are throughout any of that.

Nintendo is worth tens of billions of dollars.

And some people say it could be worth a whole lot more.

Because behind Nintendo's huge global success, cheerful characters and colorful consoles, is a company famous for holding back, choosing control over expansion and quality over scale.

I've covered the business of technology for more than a decade, from Silicon Valley to Shenzhen.

And I'm also one of the more than 3.5 billion people who play video games.

In this episode of Built for Billions, I explore Nintendo, a company that turned fun into a multi billion dollar business.

Nintendo's story stretches far beyond the controller in your hands.

The company traces its roots back to 1889 when it was founded in Kyoto, Japan.

It started out making hanafuda, a type of traditional Japanese playing card.

For much of the 20th century, it remained a family run, mostly local business.

But from the early 1970s through to the 1980s, Nintendo began to pivot first into toys and then the leap that would change entertainment forever.

More than a century on from its founding, Nintendo stands as one of Japan's most influential global brands, celebrated for combining craftsmanship with cutting edge creativity.

I think that Nintendo is considered to be a little bit of a national treasure inside Japan.

It's a very old company even by Japanese standards.

Anyone who's engaged with games knows what Nintendo is kind of about.

From toys to tech titan, Nintendo's rise has been powered by risk taking and reinvention.

And the company owes much of its innovation and creativity to one man, video game designer, producer and director Shigeru Miyamoto.

Nintendo has Miyamoto to thank for pretty much all of its success.

I would say it's very much still his design philosophy that guides Nintendo.

Sudden over Fidelity, Mario and Link and Pokemon, Kirby.

All of those characters are so familiar and are so rooted in this idea of being child friendly and sort of family friendly is really what sets Nintendo apart.

And I think that all of that comes from Miyamoto.

If you speak to any game developer in the industry, it's their games that has inspired what they've gone on to create.

And it's not just players who film Miyamoto's influence.

His creations for Nintendo helped to shape the entire video game industry.

They're often used as an inspiration, really, both from a business sense, but actually also from creative sense.

As a business, they are one of the most profitable games companies because of the way they maintain the value of their products and don't lose money on them.

Over the past 10 years, Nintendo has weathered dramatic swings in earnings, from years of booming revenue to periods of slump largely tied to waves of new consoles, major game releases, or blockbuster IP launches.

Yet even in the lean years, Nintendo's profit margins have held steady.

That kind of consistent profitability suggests that Nintendo is not riding on a single hit or console, but

rather that its brand and characters are resonating in a deeper way.

Nintendo don't like to lose money on anything.

So if you look at the PlayStation Xbox business historically, what they would do is they would sell their consoles at a loss.

And the idea is they would make the money back from the software and the services afterwards.

So they always sell things at a profit, including their new latest hardware.

Maintaining that value means that they're actually one of the highest margin game companies you can get.

For the year ending March 2024, Nintendo earned 1.67 trillion yen, or around US$11 billion, in revenue, with a net profit of 528 billion yen, or $3.5 billion.

That represents an operating margin of 32%.

The following year, as the Switch approached its end of life, both revenue and profit fell sharply.

Even so, Nintendo's efficiency remained high, clinging on to a 24% operating margin in June 2025.

The Switch 2's arrival bolstered sales and outpaced the original Switch's launch performance, selling over 6 million units in its first seven weeks.

What's interesting about Nintendo, though, is that throughout its history, the same strategy has stuck designing its most popular games and consoles in house.

Nintendo is a very proud company in that sense, that it wants to own the entire stack.

It wants to own video game hardware, software, hardware, developer relations, relations to customers directly, and

they don't want to give away that control.

Owning the full ecosystem means Nintendo keeps more of every sale driving through those high profit margins.

When it comes to performance, Sony and Microsoft chase powerful consoles and graphics.

But Nintendo focuses on fun, family, and accessibility.

I think one main driver for Nintendo is that they don't focus on high fidelity gaming.

So Nintendo is not about photorealistic 3D graphics, fluid animations and things of that nature.

And I think that kind of approach helps them with their margins.

At its core, Nintendo is making the most money with just the very traditional video game business.

But in recent years, they also tried to monetize the IP further.

When you think about video games, you think about the iconic characters and it's Super Mario and it's the Legend of Zelda and it's things like Pokemon even, which isn't directly Nintendo.

So these characters like Mario and Pikachu, they're obviously Nintendo's main IP franchises.

And because they are so recognizable, they have a mass appeal.

Pokemon was probably one of the first transmedial franchises to come out of Japan and sort of take over globally.

It started as a video game, became a manga, then became an anime, and

And the same is now true for Mario as well.

The expansion into cinema, into films, allows Nintendo to attract a young crowd who might not be familiar with Mario.

While hardware and game sales remain the core of the business, Nintendo's wider ecosystem is rapidly gaining.

This includes mobile and IP related income and other sources such as merchandise and royalties.

Compare Nintendo's 2024 fiscal year with 2023.

While dedicated platform sales remain consistent, its secondary streams of income about doubled.

Nintendo is a very interesting company because they have two core audiences.

People in my age, for instance, that have this nostalgia that is associated with Nintendo.

Nintendo is particularly good at harnessing the power of nostalgia for everyone.

And I think that sort of really contributes to sort of Nintendo's holding power.

Like it's very tight control of these franchises.

In theory, Nintendo could bring all of their software, all of their IPs, all of their characters onto every platform.

They want PlayStation, Xbox, the PC, mobile devices, etc.

Nintendo is not a company that is looking in quarters.

They think in years, they think in decades.

So Nintendo wants to be around for a long, long time.

The Switch proved that being different pays off.