Nintendo posts first ever annual loss

Japanese video game giant Nintendo reported its first ever annual loss on Thursday, after a strong yen and a growing market for games on smartphones, tablet devices and social networking sites combined to hurt sales.

The Kyoto-based firm behind the Wii and hand-held 3DS consoles posted a net loss of 43.2 billion yen ($533 million) for the business year just ended, after sales dropped 36 percent and strong yen made exports more expensive, Sky News reports.

The company put a brave face on Thursday’s results and said it expected to return to profit in 2012 as the Japanese currency weakens, according to the BBC.

It plans to launch a new 2D version of its Super Mario Bros. game this August, and is expected to release its successor to the Wii, the Wii U, later this year. It will also push its online “Nintendo Network” service, which will allow Wii U users to link up over the Internet.

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The company, which was once at the forefront of the video games world, has been hammed by a growing market for games that can be played on smartphones.

A year ago, Nintendo expected to shift 13 million Wii consoles but ended up selling only 9.8 million. Similarly, it failed to reach a sales target of 16 million for its new 3DS handsets, managing to offload only 13.5 million over the last business year, Reuters reports.

Weak demand led the company to slash the prices of the 3DS by about a third in August and sell the devices below cost, just six months after the console was launched.  

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