Strong Japanese yen forces Nintendo to cut annual profits targets
Nintendo has fallen foul of the strong Japanese yen, forcing it to slash its annual profits targets despite the smash-hit success of Pokemon Go.
The creator of Super Mario Bros said the yen's growing strength had driven it to a 5.9 billion yen (£46 million) operating loss in the six months to the end of September, down from 8.9 billion yen (£70 million) the year before.
The Kyoto-based firm said it now expects full-year operating profit to hit 30 billion yen (£235 million) compared to previous predictions of 45 billion yen (£353 million).
Nintendo's earnings have suffered from the disappointing sales of the Wii U and the 3DS handheld.
But the launch of augmented reality game Pokemon Go had sent its share price rocketing amid hope that its first foray into the mobile gaming market would trigger significant growth.
Shares closed up more than 24% on July 11, as Nintendo recorded its biggest gain since revealing the Nintendo Entertainment System (NES) in 1983.
However, Pokemon Go has had limited impact on income because the firm only recoups licensing fees and compensation, with Niantic Inc operating as the main distributor.
Nintendo, which earns 70% of sales overseas, said net profits for April to September had soared to 38.3 billion yen (£300 million), mainly boosted by a 62.7 billion yen (£492 million) gain from the sale of the Seattle Mariners Major League Baseball team.
The financial update comes after it announced its next video games platform, the Switch, which combines both a console and a handheld system for the first time.
Nintendo has not released a major gaming system since the Wii U in 2012 and has struggled to keep pace with the popularity of Sony and Microsoft and their PlayStation 4 and Xbox One consoles respectively.