Nintendo operating profits double amid brisk Wii sales
TOKYO (AFP) — Japanese video game giant Nintendo Co. said Thursday that its annual operating profit had more than doubled as sales hit a record high on surging demand for its Wii and DS consoles.
The company predicted another year of record net profits but said the pace of growth would slow as a stronger yen curbs overseas revenues.
Net profit rose 47.7 percent to an all-time high of 257.34 billion yen (2.48 billion dollars) in the fiscal year to March, a company statement said.
It missed its own previous forecast for a 275 billion yen net profit as the effect of the stronger yen started to bite.
Operating profit surged to 487.22 billion yen from 226.02 billion the previous year as revenue leapt 73.0 percent to 1.67 trillion yen.
Nintendo can barely keep up with demand for the Wii, which is known for its innovative motion-sensitive controller and -- unlike rival Sony Corp.'s PlayStation 3 -- is aimed at customers who normally would not play video games.
Nintendo said it had sold 18.61 million Wii consoles in the fiscal year, lifting total sales since the launch in December 2006 to 24.45 million units.
It sold 1.85 million "Wii Fit" boards, which can be used for sports and games including yoga, virtual snowboarding, ski-jumping and aerobics. Launched here in December, they will go on sale in North America next month.
Nintendo has long dominated the market for handheld machines and continues to enjoy strong demand for its double-screen Nintendo DS, selling 30.31 million units over the fiscal year. "Brain-training" DS games also did well.
With a stronger yen cutting into its overseas earnings, the Kyoto-based company sees a more modest 8.8 percent increase in operating profits to 530 billion yen and a 7.6 percent gain in revenue to 1.80 trillion yen.
For the current fiscal year to next March, Nintendo expects a 26.3 percent increase in net profits to 325 billion yen, with a stronger yen set to reduce earnings by 12 billion yen.
Nintendo aims to sell 28 million DS consoles and 25 million Wiis this fiscal year.
"It is not realistic to see any further growth in Japan" because of the strong sales already achieved, said company spokesman Yasuhiro Minagawa.
"But given the fact that DS is seeing a supply shortage outside Japan, we can expect sales growth in overseas markets," he said.
While Sony put the emphasis on chip power and ultra-realistic graphics for the latest addition to the PlayStation series, Nintendo opted to develop a cheaper, easy-to-use console that would appeal to a wider audience.
The Wii sells for 25,000 yen (241 dollars) in Japan while the slimmed down version of PlayStation 3 has a price tag of 39,980 yen.
Sony said in January that it would stop selling the two original PlayStation 3 models in Japan and focus on the new version amid fierce competition from Nintendo.
