As was predicted last week, Nintendo's earnings report for the first half of its fiscal year has revealed a steep decline, and the company has had to slash its outlook for the full year. For the period from April to September, Nintendo's sales dropped 34.5% to 548.01 billion yen ($6.1 billion), while net income plummeted 52% to 69.49 billion yen ($772 million).
The company blamed "the limited number of hit software releases in the period to drive hardware sales (compared to Wii Fit, Super Smash Bros. Brawl and Mario Kart Wii in the corresponding six month period a year ago), the appreciation of the Japanese yen, particularly against the U.S. dollar, and the price reduction on Wii hardware."
The result is that Nintendo has now cut its full-year profit outlook for the first time in six years. Net income is now expected to come in at 230 billion yen (down from the previous guidance of 300 billion yen), while the full-year sales outlook was lowered from 1.8 trillion yen ($20 billion) to.1.5 trillion yen ($16.7 billion).
Nintendo also lowered its corresponding hardware and software figures. The company expects to sell 30 million DS units with 150 million software units (vs. the old forecast of 180 million). For the Wii, Nintendo expects to sell 20 million hardware units (vs. previous forecast of 26 million) and 180 million pieces of software (vs. 220 million). Life-to-date, Nintendo has sold 113.5 million DS units worldwide and 56.14 million Wiis.
Although the first half didn't live up to expectations for Nintendo, it's not that surprising, say analysts. "It's just not realistic for them to repeat what they did last year," said Hiroshi Kamide, a director at KBC Securities Japan, to the AP.
