Nintendo Forecasts First Year-End Loss in Three Decades

  • Share
  • Read Later

Mario and Luigi, you might want to start sharpening up those plumbing skills after all. For the first time in three decades, gaming giant Nintendo is forecasting an annual loss, with an expected dip into the red of 20 billion yen ($263 million) for financial year ending March 2012.

The forecast follows the company announcing a net loss of 70.3 billion yen for the six month period through September, compared with a 2 billion yen loss for the same period last year, and contrasts sharply with the company’s July prediction of a 20 billion yen profit for year ending March 2012 (Most outside analysts had expected profit to be somewhere in the region of 12 billion yen).

(MORE: Amazon Profit Falls 73%, Company Forecasts Loss for Q4)

In a statement, the company admitted that “sales of the Nintendo DS hardware and Nintendo 3DS software were weaker than expected,” with overall sales for the company falling 41% in the last six months (the company slashed the price of the 3DS system back in August in response to this).

Additionally, the recent strength of the yen has hurt the company more than initially expected. With the yen at a post-war high against the dollar and decade-high against the euro, overall profit for the company is in a slump considering almost 80% of revenue comes from Europe and America. The forecast marks the first year-end net loss for the company since 1981, no doubt compounding shareholder concern about the company’s future.

MORE: Amazon Freezes Nintendo 3DS Sales After Customer Complaints

Graeme McMillan is a reporter at TIME. Find him on Twitter at @Graemem or on Facebook at Facebook/Graeme.McMillan. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.