“Nintendo Co. said its fiscal-first-half net profit tumbled more than 50% and warned the rough ride will continue, slicing nearly a quarter off its full-year profit forecast as sales of its Wii videogame consoles wane amid a shortage of new blockbuster games,” Kenneth Maxwell reports for The Wall Street Journal.
“The Kyoto-based company, long one of Japan’s technology stars, said net profit for the six months ended September fell to 69.5 billion yen ($765.5 million) from 144.8 billion yen a year earlier. That is well below Nintendo’s own previous forecast of 100 billion yen. It didn’t disclose details of its earnings for the quarter ended September,” Maxwell reports. “The first-half slump leaves Nintendo with a headache with respect to its Wii strategy going forward. The results reflect a nearly 50% drop in Wii console sales to 5.75 million from 10.1 million. Overall, first-half revenue dropped 35% to 548.1 billion yen from 836.9 billion yen a year earlier.”
Nintendo “faces growing competition in the hand-held market from Apple Inc.’s iPhone and iPod touch and their growing lineup of games,” Maxwell reports. “Nintendo on Thursday said it will introduce a new version of its popular DS hand-held, the Nintendo DSi LL, that comes with a larger 4.2-inch screen that allows users to surf the Web and will encourage them to use the device as a music player. The current DSi has a 3.25-inch screen. The company said it will go on sale in Japan on Nov. 21 for 20,000 yen, though it did not announce any immediate plans to sell the new device outside of Japan.”
Maxwell reports, “Nintendo said it now expects net profit for the year through March 2010 to be 230 billion yen, down from the 300 billion yen it previously forecast. That would mean an 18% drop from the 279.1 billion yen net profit it reported for the year ended in March.”
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