Nintendo heads for first annual loss
Published 26/01/2012 | 10:16
NINTENDO has posted a sharp drop in quarterly profit and forecast a bigger-than-expected full-year loss as it battles a strong yen and its games devices lose ground to gadgets such as Apple's iPhone.
The loss at the creator of the Super Mario franchise will be its first at an operating level.
Nintendo dominated the video games industry for years with its DS handheld players and Wii home consoles, but is now struggling to keep up as more versatile smartphone and tablet sales boom.
"To say that (the days of consoles) are over is likely an overstatement, but social network and Internet delivered games are growing and structurally changing the future of the industry, which is a strong wind against Nintendo," said Shigeo Sugawara, senior investment manager at Sompo Japan Nipponkoa Asset Management.
Nintendo now expects an annual operating loss of 45bn yen (€440,100m), dwarfing expectations of a 4.2bn yen loss, based on the average of 21 analyst forecasts.
"Their time of growth (from consoles) is over, and, while I don't think the company will cease to exist, if they don't move into new categories, they will no doubt lose the great scale they've amassed," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management in Tokyo.