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Nintendo makes profit on 1.95 million Wii U sales, but predicts dire final quarter

Nintendo makes profit on 1.95 million Wii U sales, but predicts dire final quarter

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Gallery Photo: Nintendo Wii U hands-on pictures
Gallery Photo: Nintendo Wii U hands-on pictures

Nintendo made an operating profit of ¥21.7 billion ($210 million) in its crucial fiscal third quarter as the Wii U picked up sales over the holiday shopping period. Net income was ¥9.6 billion ($93 million). The company sold 1.95 million Wii U systems between October and December, a major increase on the preceding two quarters, but a 36 percent decrease from a year ago when the console was first released. The 3DS portable continued to sell well, with 7.76 million sold in the quarter; Nintendo notes that it was the best-selling video games system in the US throughout 2013.

Nintendo has now sold 5.86 million Wii U units worldwide

Nintendo has now sold 5.86 million Wii U units worldwide, 2.41 million of which came in the current financial year. The company has set itself a target of 2.8 million consoles before the year ending March, after previously expecting to move 9 million units. While that forecast appears attainable with only 339,000 systems remaining, it might be tight — Nintendo only sold 460,000 units in the six "normal" months leading up to Q3, which didn't have the guaranteed holiday sales boost. For comparison, Sony had sold 4.2 million PlayStation 4s and Microsoft 3 million Xbox Ones at the end of 2013 after both went on sale in November.

Earlier this month Nintendo warned of a third consecutive annual operating loss after previously predicting a return to profit. Although the company made a profit this quarter and operating loss stands at ¥1.58 billion ($15.3 million) for the year, Nintendo is forecasting a loss of ¥33.4 billion ($323 million) in the final quarter of the year for a total operating loss of ¥35 billion ($339 million) in 2013.

President Iwata to take pay cut over results

Sales are expected to "decrease significantly due to seasonal factors as the year-end sales season concludes," according to the company. President and CEO Satoru Iwata told reporters today that he will take a 50 percent pay cut for five months to recompense for Nintendo's poor performance; other board members will slash their salaries by 20 to 30 percent.

Despite calls from analysts and consumers for the company to release its popular franchises on devices other than its own dedicated games consoles, Nintendo executives have indicated that the company plans to use smartphones and tablets only as advertising aids. Nikkei claimed this week that Nintendo is to release minigames on mobile platforms for marketing purposes, and could announce the plan as soon as Thursday; Nintendo, however, denied the report.

Additional reporting by Aaron Souppouris.