Nintendo forecasts lower Wii and DS sales than previously thought as momentum slows

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Nintendo on Thursday gave further evidence that the momentum for its Wii and DS game consoles has slowed.

The Japanese gaming company now says it expects to sell 22.5 million DS portable devices and 16 million Wii consoles for its fiscal year ending March 31. It had previously expected to sell 23.5 million DS’s and 17.5 million Wii’s.

Offsetting the decline in device sales, however, is an expected increase in the sale of games sold for those systems. The company said it expected to sell 135 million games for DS, up from 125 million previously estimated, and 170 million Wii games, up from 138 million.

Nintendo in general makes a bigger profit on games than on consoles.

Overall, however, Nintendo’s sales were down from a year earlier. Sales of the DS fell 33% during the first nine months of Nintendo’s fiscal year, which started April 1. It sold 15.7 million DS consoles in that period, compared to 23.35 million a year earlier. Sales of DS games slumped 18% to 98.9 million copies, down from 121.4 million a year earlier.

The Wii also saw a significant downturn in sales. Sales of the console fell 20% to 13.7 million units from the previous year, while Wii game sales fell 4% to 150.5 million copies.

The decrease in sales, plus a sharply rising Japanese yen, clobbered Nintendo’s earnings. For the first nine months of its fiscal year ended Dec. 31, revenue fell 32% to 808 billion yen, or $9.8 billion. Net income tumbled 74% to 49.6 billion yen, or $603.1 million. Nintendo estimated that it lost roughly $1 billion from foreign exchange losses due to the strong yen. A year earlier, a weaker yen led to a $121.7-million gain in income.

Nintendo is betting that a strong debut of its newest portable console, the 3DS, will help spark sales. The device, expected to be released March 27 for $249.99, will have competition for the Christmas holidays later this year, when Sony Corp. said it will release its latest portable console, code-named the NGP.

-- Alex Pham

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