Nintendo Powering Down Ahead of 3DS Launch

Posted Jul 29th 2010 6:20PM by Derek and Damien Hoffman
Filed under: Nintendo (NTDOY)

This winter should be an exciting time for video game companies. Unfortunately, at the moment fan favorite Nintendo (NTDOY) is powering down.

Nintendo announced revenues of only ¥189 billion, much lower than the consensus estimate of ¥212 billion. Earnings came in at a ¥197 loss, widely missing the consensus estimate of ¥34 billion.

The main culprit was a strong yen, which amplifies an already tougher market given that Nintendo relied on overseas customers for 87% of sales this quarter. given the current macro environment, this currency problem will likely plague a Japanese video game giant again this quarter.

Nintendo's light at the end of the tunnel is the much-anticipated launch of their 3-D handheld gaming system 3DS. Industry expert and friend Michael Pachter believes the three DS is a revolutionary innovation which will be a huge winner for Nintendo in the future.

Until then, investors will have to power up their Wii's and play another round of Mario Kart.

Derek and Damien Hoffman are the authors of the acclaimed Wall St. Cheat Sheet Premium newsletter.

Tags: 3ds, featured, handheld gaming, inthenews, nintendo, nintendo 3ds, videogames, wii