Nintendo has deepened the gloom enveloping corporate Japan after profits hit a seven-year low because of stiff competition in the video games console market and a post-earthquake slide in consumer confidence. The electronics company plans to introduce an updated second generation version of its best selling Wii console next year to provide stronger competition against Sony's PlayStation 3 and Microsoft's Xbox 360.
Nintendo has already added to its product range with the 3DS, a glasses-free three dimension handheld device and is forecasting sales of 16m this year. However, initial sales have underperformed expectations.
Analysts say new products are urgently needed to contain the damage caused by the collapse in Wii sales, down 5m units to 15.1m last year, and expected to fall by another 2m in the current financial year.
Net profits in the year ending March 31 slumped 66pc to 77.6bn yen (£574m) while operating profits dropped 52pc to ¥171.1bn. Nintendo disappointed analysts looking for operating profits of ¥215.8bn for the year to March 2012 with its forecast of ¥175bn.
Spending apart Nintendo escaped the worst effects of the earthquake, unlike the motor industry. Car production at Toyota factories in Japan slumped 63pc to 129,491 last month after output and component supplies were disrupted by the natural disaster. (read more)
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