Nintendo profits down as GameCube sales decline

November 25th, 2005, 23:14 Posted By: wraggster

Nintendo has published financial results for the half-year ended September 30, revealing a drop in profits of USD 82.7 million from the same period last year - a fall of 21.1 per cent.

Consolidated net profit stood at YEN 36.63 billion (USD 308.4 million), down from YEN 46.45 billion (USD 391.1 million) in 2004. But despite the fall, the figure was slightly higher than that predicted in the company's financial forecast due to favourable foreign exchange rates.

Operating profit was down 51 per cent to YEN 19.6 billion (USD 165 million), while net income stood at YEN 36.6 billion (USD 308.1 million) - down from YEN 46.4 billion (USD 390.7 million) last year. Sales fell 6.2 per cent to YEN 176.4 billion (USD 1.49 billion).

Nintendo attributed the drop in profits to increased research and development costs as the company prepares to launch the next-generation Revolution console in 2006. The fall was also blamed on lower sales of GameCube consoles and software, particularly in North America.

Nintendo cut its forecast for the number of Nintendo DS units likely to be sold globally this financial year - the forecast is now down to 12 million from 12.4 million. The forecast for GameCube sales was also slashed from 2.8 million to 2.4 million, but Nintendo predicts that 11 million products from its Game Boy Advance range will be sold - an increase over the previous forecast of 10.2 million.

Nintendo's full year forecast was not altered: operating profit is predicted to stand at YEN 90 billion (USD 758 million), with net profit at YEN 75 billion (USD 631 million) and sales at YEN 400 billion (USD 3.4 billion).

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