President of Nintendo Satoru Iwata explained that the Wii U will have a negative impact on earnings in the upcoming quarter due to, "rather than determining a price based on its manufacturing cost, we selected one that consumers would consider to be reasonable." He also stated, "In this first half of the term before the launch of the Wii U, we were not able to make a profit on software for the system while we had to book a loss on the hardware, which is currently in production and will be sold below cost."
This news comes just after Nintendo announcing they'll begin making a profit on each 3DS system sold, nearly two years after the console's launch. It's worth noting, this isn't the first time Nintendo has launched a home console at a loss. The Gamecube was not profitable at the beginning of its generation either.
