By Lynn Little
Nintendo raised its full-year net profit forecast by 20 percent today, citing a stronger dollar and solid demand for software titles for its handheld Game Boy Advance system.
The company said it now expects a group net profit of 84 billion yen $758.9 million) for the remainder of the year to March 2005, compared to its May forecast of 70 billion yen.
“Our Gamecube hardware business was slightly hurt by price cuts by our Rivals, but we’re considering launching a sales promotion campaign for the peak Christmas shopping season and expect to achieve our full-year sales target,” said Nintendo Senior Managing Director Yoshihiro Mori.
Sharp upward revision was due mainly to a foreign exchange-related gain of 36 billion yen, according to Nintendo. It holds about $5 billion worth of dollar-denominated deposits, which it re-values at the end of every accounting period.
The latest revision stems from a change in its assumed exchange rate from 105 yen to the U.S. dollar to 110 yen to the U.S. dollar. The dollar traded at around 110.60 yen as of today.
Strong demand for Game Boy Advance titles also helped improve its operating profit margin in the first half, more than offsetting slower-than-expected sales of its GameCube consoles.