TOKYO Jan 30 Japanese games maker Nintendo Co
Ltd cut its earnings outlook and forecast a second
straight year of annual losses, as the sales of its new Wii U
games console lost momentum.
The company forecast an annual loss of 20 billion yen ($220
million) in the year to March, slashing its previous forecast of
as much in profit, and falling well short of a consensus
estimate of 12.1 billion yen profit from 19 analysts.
"It was a somewhat negative surprise," said Yasuo Sakuma,
portfolio manager at Bayview Asset Management.
Nintendo, which began making playing cards in the late 19th
century, has been counting on its Wii U - the successor to the
six-year old Wii - to revive its performance as competition from
Apple Inc and other makers of mobile phones and tablet
It lowered the sales forecast for Wii U in the year to March
31 to 4 million consoles from its previous estimate of 5.5
million, and also cut the sales outlook for handheld devices 3DS
and Wii as well.
The firm reduced its 3DS sales estimate to 15 million
consoles compared with an earlier 17.5 million, and cut its
projections for the DS to 2.3 million from 2.5 million in
Nintendo's downgraded forecast came even as the yen has
fallen sharply against other currencies in the past two months,
a windfall for the firm that sells more than 70 percent of its
Company President Satoru Iwata said software development for
the Wii U has not gone as planned, but added the company aims to
return to operating profit of more than 100 billion yen in the
next financial year, which starts on April 1.
The shift in gaming habits, analysts say, may eventually
force the Japanese company to chase profits for Super Mario and
other game titles on devices built by other firms.
In November it launched the Wii U, its first console in 16
years to come with a dedicated Super Mario game title. It also
features a "Gamepad" controller that functions like a tablet.
It also features a social gaming network dubbed "Miiverse",
a bid to catch up with the online strategy of rivals such as
Before the earnings announcement, Nintendo's shares fell 2.1
percent on Wednesday to 9,350 yen, just above near-10-year low
of 8,500 yen touched early this month.