Nintendo Co. forecast Thursday its profit will fall in 2010 to the lowest level in four years as sales of its flagship Wii game console decline.
Net income will drop 13 percent to ¥200 billion in the 12 months ending next March, after declining 18 percent a year earlier, the company said.
Nintendo projected that the number of motion-sensing Wii consoles sold will drop for a second year, outweighing an increase in sales of its portable DS player, as the company faces mounting competition from Sony Corp., Microsoft Corp. and Apple Inc.
President Satoru Iwata plans to introduce a 3-D model of the hand-held DS and a heart-rate-tracking Vitality Sensor accessory for the Wii this fiscal year to revive earnings growth.
"Nintendo investors will need to be patient this year," said Eiji Maeda, a JPMorgan Chase & Co. analyst. "Although the company will strengthen its software lineup for the Wii during the first half, the real contributions from the 3DS will probably materialize next year."
Operating profit, or sales minus the cost of goods sold and administrative expenses, will probably fall 10 percent to ¥320 billion as revenue declines 2.4 percent to ¥1.4 trillion, the company said. Those forecasts compare with the average analyst estimates of ¥349.1 billion in operating income and ¥1.39 trillion in revenue.
Sales of the Wii will probably slide to 18 million units in the period, after declining for the first time last fiscal year, Nintendo said. Sales of the DS will rise to 30 million, the company said.
Yusuke Tsunoda, an analyst at Tokai Tokyo Securities Co., forecast in a March 24 report that sales of the Wii would probably fall 5 percent to 20 million units this fiscal year.