Nintendo Co. is pressured to make its smartphone debut a success amidst weak sales of 3DS handheld players doubled with the impact of a stronger yen. As a result, the company has halved its annual profit outlook for the year.
The video game company is expecting a net profit if 17 billion yen ($200 million) in the year ending March. The said projection is 51.4 percent down from that of last year. The operating income, furthermore, is at 33 billion yen this fiscal year. It is also down from an earlier projection of 50 billion yen. The reduced profit is caused by currency fluctuation. "The company cuts its projection for sales 12 per cent to 500 billion yen, the lowest revenue level in at least 15 years," Bloomberg reports.
"Sales of the 3DS fell short of our targets from January," Nintendo spokesman Yasuhiro Minagawa said. "After adding the impact of stronger yen, we had no choice but to revise."
"Nintendo is promising that next fiscal year will mark a return to the level of profits it used to enjoy," Iwai Cosmo's Kawasaki said. "Without a hit smartphone title, that's likely to be postponed."
Nintendo expects have foreign currency transaction losses of ¥20 billion this year, according to Japan Times.
The Kyoto-based company said it has plans to release its Miitomo game by next month.
The game is for mobile devices next month. It will help stir the company's normal offer since the 1970s. The goal for the shakeup is to try to capture players who have shifted to mobile gaming.
"Lack of hit titles dragged down 3DS sales during the holiday season and looks like the slump extended to January and February," said Tomoaki Kawasaki, an analyst at Iwai Cosmo Securities Co. "Nintendo is at the end of the hardware cycle, so neither 3DS nor Wi U are likely to see much growth."
Earlier this month, the company opened their registration for Miitomo. The game is a free-to-play messaging-based application. President Tatsumi Kimishima announced that the next smartphone game will feature beloved characters of the company.
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