Nintendo (NTDOY) said sales will level off in the next 12 months as fewer game fans run out and buy Wii and DS game consoles.
It has been almost three years since the surprisingly popular Wii started selling faster than Nintendo could produce them and nearly five years since the original Nintendo DS handheld game player was unleashed.
Nintendo recently released the Nintendo DSi, adding a camera and wireless capabilities to the dual-screen game player. Can a new Wii be far behind? How else can Nintendo revive sales?
To be fair, Nintendo is seeing sales slump in Japan, while still rising it the U.S. and Europe. Since Japan tends to get the products released there first, the sales drag seen there should soon spread to the rest of the world.
The Wii's success wasn't anticipated as hard-core gamers laughed at its simplistic game graphics and goofy name. Nintendo has been laughing ever since as profits have nearly tripled as it sold 50 million Wii's since November of 2006. The Wii has almost outsold the more sophisticated and pricier Microsoft (MSFT) Xbox 360 and Sony (SNE) PlayStation 3 combined.
Wii sales missed Nintendo's forecast over the past fiscal year. The company sold just under 26 million Wii's, missing Nintendo's lowered estimate of 26.5 million in January. This year, Nintendo sees Wii sales of 26 million.
Sales of the DS are expected to drop four percent to 30 million for the current fiscal year, the company said.
With expected sales of 56 million Wii and DS players in the next year, don't expect new game consoles out of Nintendo anytime soon. In the past, the company has resorted to price cuts to goose sales of existing game players. Nintendo's Game Boy was sold in various incarnations starting in 1989 until being replaced by the DS 17 years later.
Wii and DS players with their motion-sensing controllers and styluses will be playing Mario Galaxy for a few more years.
Anthony Massucci is a senior writer and columnist for DailyFinance.
Basics of Diversification
Learn one of the fundamental concepts of building a portfolio.View Course »