Nintendo, whose profits have gained every year for the last five years, may be facing a loss of momentum in sales of its Wii home console.<\/p>\n
Rivals Sony Corp. and Microsoft Corp. have not only come up with similar wandlike controllers that track player’s motions but they have also slashed prices on their offerings, the PlayStation 3 and the Xbox 360 machines.<\/p>\n
To stay competitive, Nintendo, which also makes Super Mario and Pokemon game software, recently cut the Wii price to 20,000 yen ($217) from 25,000 yen ($272) in Japan and to $200 from $250 in the U.S. But an earlier price cut for the Sony PlayStation 3 to about $300 has been effective in boosting its sales.<\/p>\n
The Wii is now about the same price as Microsoft’s low-end Xbox 360 Arcade. The price on Microsoft’s Xbox 360 Elite was cut to about $300 in August.<\/p>\n
The strengthening yen is another factor hurting the bottom line of export-dependent Nintendo.<\/p>\n
BY THE NUMBERS<\/strong><\/p>\n Nintendo is forecasting a 7.5 percent rise in net profit to 300 billion yen ($3.3 billion) for the fiscal year through March 2010 from the previous fiscal year, on 1.8 trillion yen ($19.6) revenue, down 2.1 percent on-year.<\/p>\n The Kyoto-based manufacturer expects to sell 26 million Wii machines and 30 million DS machines in the 12 months through March 2010. The Wii is still the top-selling home console, having sold nearly 53 million globally since its 2006 introduction.<\/p>\n Analysts surveyed by Thomson Reuters, on average, expect fiscal year profit of 279 billion yen ($3 billion), about the same as the record profit in the previous fiscal year.<\/p>\n ANALYST TAKE<\/strong><\/p>\n Yusuke Tsunoda, analyst with Tokai Tokyo Securities, said the Wii has sold so well, nearly to the point of market saturation, that it may take the arrival of a totally new machine to get sales to take off significantly again. “The price cut on the PlayStation 3 was effective because people are getting a high spec Blu-ray disc player for a good price,” he said. Nintendo is expected to give some hints on game software in the works, which should be useful for gauging its prospects, Tsunoda said.<\/p>\n WHAT’S AHEAD<\/strong><\/p>\n Like other gaming and electronics makers, Nintendo faces a big test in wooing consumers during the year-end shopping period. The global slowdown has taken its toll on Nintendo’s key U.S. market, although company officials have repeatedly said the game business is relatively recession proof.<\/p>\n