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BW Businessworld

Nintendo Annual Profit Drops 52%

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Japan's Nintendo Co Ltd posted its second straight fall in annual profit on Monday, as sales of its ageing Wii games console slowed and the March 11 earthquake weighed on Japanese consumer spending.

Operating profit fell 52 per cent to 171.1 billion yen ($2.09 billion) in the year ended in March from 356.8 billion yen the previous year, below a Thomson Reuters SmartEstimate of 200.8 billion yen. SmartEstimates put more weight on recent forecasts by highly rated analysts.

The maker of the DS handheld games device expects operating profit of 175 billion yen for the year to March 2012, compared with a consensus of 215.8 billion yen, based on eight analysts polled by Thomson Reuters I/B/E/S after the March 11 disaster.

Nintendo, which competes with Sony Corp and Microsoft, also faces a growing challenge from smartphones and tablets. In a bid to fight back, it launched a glasses-free 3D-capable handheld games device, the 3DS, in late February in Japan and a month later in the United States and Europe.

The company also announced that it will release a successor to the Wii in 2012.

Nintendo shares closed up 0.9 per cent ahead of the earnings report, while the broader market fell 0.1 per cent.

(Reuters)