Nintendo released its yearly financial report earlier today and the results are grim. Nintendo sales declined 22% for the year ending in March 2010 which marked the companies first revenue drop in years. Nintendo also predicts another 2.4% decrease in sales for its next fiscal year that ends in March 2011. Nintendo cites the Wii price cut and lack of compelling software as the main contributors to its losses. Nintendo can expect Wii sales to go up slightly following the release of Super Mario Galaxy 2 and the black Wii later this month, and it still has the 3DS as its ace in the hole.
Industry analyst Michael Pachter thinks Nintendo’s stance to put off a successor the the Wii is the one of the main reasons why sales are decreasing. Pachter also states that the Wii game to console ratio falls at about 2 to 1. This means the average customer is not buying more than two games Wii games per yer. Pachter feels the Wii’s processing power is forcing developers to create games that won’t gain as much attention as a PS3 or Xbox 360 title. The solution to this problem is to release a Wii 2 that has similar capabilities as the PS3 and Xbox 360. Pachter believes this is the way for developers to port similar games to all three platforms.
In the end Pachter feels Nintendo will wait too long to introduce the Wii’s successor.