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Nintendo doubles profit but slashes full year target

Article By: ,  Financial Analyst
January 29, 2015 10:26 AM

Nintendo has posted a mixed trading statement for the past 12 months.

The game and console maker announced a 50 per cent boost in operating profit in the third quarter of its fiscal year totalling 31.8 billion yen (£177 million). Despite the strong performance in the latter stages of the year, it was not enough to prevent the company from reducing its full year target.

Christmas provided a major boost for the company with October to December being the top performing part of the year but it still amended its earnings target for the fiscal year to March. The firm now expected to generate 20 billion yen over the course of its financial year, a revision from the 40 billion yen previously predicted.

Increasing competition

Nintendo has seen increased competition from Sony and Microsoft in the console market with the latter launching the PlayStation 4 and Xbox One in recent years. While Nintendo stated that it had enjoyed a boost in sales for its 3DS consoles in Japan, it was failing to meet the same expectations in the European market.

The company said in a statement: "However, as sales of the Nintendo 3DS hardware in the United States and in Europe did not grow sufficiently, the global sales of the Nintendo 3DS family hardware were 7.08 million units."

Nintendo's latest product, the Wii U, has performed poorly. Since its launch in 2012, only 9.2 million units have been sold but the company stated that it is fully behind the console and that it would not shelving the product.

Speaking to Japanese site Sankei, Nintendo president Satoru Iwata said: "Wii U is not over yet. I want to continue to build on playing on people’s high expectations [for the system]."

Nintendo's share price was down 8.66 per cent as 09:44 GMT on Thursday (January 29th).

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