Nintendo reported a first-fiscal-quarter net loss, hurt by both slow sales of its 3DS handheld game device and a strong yen. The Kyoto-Japan-based company cut its full-year forecast as a result.
For the quarter ended June 30, the company reported an operating loss of 37.7 billion yen ($483.6 million), worse than the expected profit of 7.1 billion yen, according to Thomson Reuters. Nintendo now expects an annual operating profit of 35 billion yen, down dramatically from its previous forecast of 175 billion yen.
Analysts had expected a full-year profit of 154.9 billion yen. Nintendo rivals Sony and Microsoft have come on strong in the console market in the past year, prompting Nintendo to announce a new game console, the Wii U, which is coming at an unspecified date in the next year or so.
Meanwhile, Apple’s iPhone, iPod Touch, and iPad devices have eaten away at the market share enjoyed by the once-dominant Nintendo DS. The new 3DS, which lets you see stereoscopic 3D without glasses, hasn’t sold nearly as well as expected.
Nintendo said that price cuts for the Wii outside of Japan and the Nintendo DS Lite in the U.S., as well as a scheduled price cut for the 3DS, have contributed to the loss. Nintendo is also spending more money on marketing and research and development as it readies its new Wii U console. To date, Nintendo has sold 87.57 million Wii consoles, including 1.56 million in the quarter. It has sold 4.32 million 3DS units, including 710,000 units in the first quarter. It has sold 147.8 million DS units, including 1.44 million in the first quarter.