2.    Nintendo

Market Share: 13% (+3)
2006 Position: 2 (UNCH)
Revenues: $8.0 billion (+90%) including hardware
Profits: $1.8 billion (+150%)
Expectations: 20% increase in operating income
12 Month Range: $180-$340 <NTDOF.PK>
Employee Count: 3,400 (+200)
Age: 118 years
SKUs in NPD Top 100: 31 (+17)
Franchises above 80%: 9 (-6)

The undisputed winner in the industry transition so far, Nintendo’s growing dominance is evident in everything from the ludicrously fat profit growth to the massive grin of COO Reggie Fils-Aime. The company’s profits dwarf every other games-only company on this list, and its SKUs in the top 100 have more than doubled, to the point where it has published nearly a third of the best-selling games in America. In a strange contrast however, review scores have dipped for the company’s offerings – likely a consequence of Nintendo taking some emphasis off the traditional hardcore market, the consumer group that most reviews are written for.

Last year we said that getting the public to accept Wii was Nintendo’s biggest challenge. The company has met that challenge in a way that exceeded everyone’s expectations, so that six months after the holiday season the supply of the system is still far outstripped by demand. Anecdotal evidence creeps on to the internet day after day of senior retirees enjoying the system with their tiny grandchildren, as Nintendo finds consumers most other publishers write off sight unseen.

The DS likewise continues to dominate the handheld market, and Nintendo continues to populate these two systems with a wide swath of software to appeal to a variety of gamer types. Even more surprisingly, it’s expected that this incredible growth will continue as supply lines become less constrained and new products like Metroid Prime 3 and Zelda: Phantom Hourglass hit the market. It’s quite likely that at least the near future of the industry belongs to Nintendo – and judging by how they’ve handled that responsibility so far, the industry will be healthier for it.

Pictured:
New Super Mario Bros.
Super Mario Galaxy
Brain Age 2: More Training in Minutes a Day
Metroid Prime 3: Corruption