Nintendo slashes its annual sales forecast

Nintendo has halved its annual sales estimate for the financial year, despite a strong showing over the Christmas period from its Wii U console.

However, the Japanese company did reveal its third quarter figures for 2014, which showed a total revenue of $2.3 billion (£1.5 billion) and a net profit of $383 million (£252 million).

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The Christmas period saw an upturn in fortunes for Nintendo’s Wii U console, which has struggled to gain traction with consumers in the face of competition from Microsoft’s Xbox One and Sony’s PlayStation 4. The device shifted 1.91 million units, an increase of 610,000 over the previous quarter.

Nintendo’s handheld gaming device the 3DS also saw a sales increase over the period, with 4.99 million units sold. However, Nintendo did concede that 3DS sales in Europe and the US “did not grow significantly.”

The figures have led the video game firm to cut its sales estimate for the financial year in half, down to $170 million (£112 million) and according to TechCrunch are likely to lead to an overall loss of $85 million (£56 million) for the final quarter.

While Nintendo reportedly has enough cash reserves from its previous gaming successes to run a deficit for 38 years, it will still be keen to reassert itself as a realistic challenger to both Sony and Microsoft.

Both the Wii U and 3DS have also had to face the rise of mobile gaming, which has become increasingly popular following the advent of smartphones.

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Despite Nintendo’s difficulties, its reported software sales were more promising, where Super Smash Bros generated “extremely strong initial sales,” rising to 6.19 million in Q3. The latest entry in the hugely successful Pokémon franchise, Omega Ruby and Alpha Sapphire, managed to ship 9.25 million units, while a number of popular third-party releases for the 3DS helped total software sales hit 53.04 million units.