Delay in 3D DS Launch Lowers Nintendo’s Profit Expectations Considerably

Added by Nigel Shelbourne on September 30, 2010

Nintendo’s new 3D version of the DS will miss the year-end shopping season and will be launched in Japan only in February of next year and the United States in March.

Sales of DS and Wii from Nintendo had been sagging with growing trends in using Smartphones and other gadgets for playing games.

Nintendo is also faced with intense competition from motion-gaming systems from Sony and Microsoft which are expected to hit the market by the year-end. The new 3D version of DS was expected to boost sales, profits and market presence for Nintendo.

It would be attractive to play the popular Mario game on a 3D screen. The machines are also supposed to be capable of taking 3D photos and would require no special glasses for viewing them. Unfortunately, the product could not be launched on time to target the year-end shoppers as Satoru Iwata, President of Nintendo, stated that they might not be able to supply the required units.

The new machines would cost about 25,000 yen compared to the existing DS units priced at 12,000 to 16,000 yen. However the costlier models cannot be released this year.

This led Nintendo to lower the DS sales forecasts from 30 million units to 23.5 million units by March 31, 2011. This coupled with a stronger yen has forced Nintendo to lower its operating profit expectations for this year significantly by one-third to 210 billion yen. Profit figures have been revised from 120 billion yen to 50 billion yen by September 30, 2010.