Nintendo May Post First Profit Warning in Six Years

Looks like Nintendo will have less money printed than normal this year, as analysts are expecting the company to forecast its first profit drop in six years. The blame is being placed on falling Wii sales, the recent console price cut and the strength of the Japanese Yen.

Bloomberg reports that net income will fall 11 per cent to 249.3 billion yen ($2.7 million) in the fiscal year. Nintendo were forecasting 300 billion yen net income, so it looks like these projections will be suitably revised. Wii sales fell for the first time in the quarter that ended 30th June, but this period has been sluggish for all concerned as Bloomberg notes that Sony sold the fewest number of PS3s in two years during that quarter.

Deutsche Bank AG analyst Satoru Kikuchi said, “Nintendo may cut its profit projection about 30 percent because of sluggish sales in the first half, the price cut for the Wii and currency-related impact. Investors are expecting the company to fully reflect its business environment in its forecast.”

But it wasn't all about the tough economic climate. Sony's PS3 outsold the Wii in both the US and Japan in the last month, which has had an impact on the number of Nintendo consoles sold too. The stronger Japanese currency is said to reduce the value of the company's overseas sales, deposits and other assets abroad.

Nintendo is to announce its earning on 29th October.