Nintendo Braces for First Annual Loss in Three Decades, Points to 3DS and Yen as Cause
October 28th, 2011
Nintendo is having a hard time for the first time in 30-years – as it eyes its first annual loss. The net loss is estimated to be about $264 million for the year that will end in March. Last year, the company made about that much in profit. The reason for the falling profits is not surprising.
Nintendo 3DS adoption has been very poor and much worse than anticipated by Nintendo. Even after the price cut, Nintendo is unable to sell sufficient quantities of the console. That is no surprise, considering the console launched before there was anything close to a robust game library available, and general market interest in 3D technology has been questionable at best.
The other problem for Nintendo is that the Japanese Yen is rising compared to other currencies. With the Yen worth more than other currencies, money made overseas is worth less on the books in Japan. Nintendo had a 52.4 billion Yen foreign exchange loss in the first half of the fiscal year.
[via Bloomberg]
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