Japan’s Nintendo Co bucked the economic gloom yesterday with record profits for the year to March, saying the video game industry was proving to be relatively recession-proof.
The strong results are in stark contrast to the financial woes of most of Japan’s electronics giants, which have been badly hurt by the economic crisis.
Nintendo said its annual net profit rose 8.5 percent to ¥279.09 billion (US$2.8 billion), helped by brisk sales of its Wii and DS consoles — easily beating its own forecast for earnings of ¥230 billion.
It said the video game industry had been less affected than most by the global economic downturn, despite a drop in consumer spending.
The company’s operating profit increased 14 percent to ¥555.26 billion in the year to March as revenue climbed 9.9 percent to a record ¥1.84 trillion.
Nintendo has enjoyed huge success with its consoles, including the Wii, which aims to appeal to people buying a video game console for the first time.
It has sold 50.39 million Wii consoles worldwide since the launch in 2006, including 25.95 million in the year to March, making it the fastest home video game console to reach the 50 million sales milestone, Nintendo said.
But there are signs that Wii sales are losing some of their luster at home.
An industry survey released last month showed that the rival Sony PlayStation 3 had outsold the Wii in Japan for the first time in 16 months, with sales of the Nintendo console dropping almost two-thirds from a year earlier.
Nintendo president Satoru Iwata admitted recently that the Wii was “in the most unhealthy condition since it hit the Japanese market.”
The video game titan is pinning its hopes on new games and software such as Wii Sports Resort — a sequel to the popular Wii Sports that will go on sale in Japan next month — to energize sales.
The company sold 31.18 million handheld DS machines in the year to March, lifting lifetime sales to 101.78 million units.
It aims to sell 26 million Wii consoles and 30 million DS machines in the current business year to March, helping annual net profits to grow 7.5 percent to a projected ¥300 billion, which would be a record.
But operating earnings are seen slipping 11.8 percent to ¥490 billion and revenue is seen dipping 2.1 percent to ¥1.80 trillion.
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