Nintendo Jumps After Strong Results, OutlookBy Reuters - | Posted 2008-01-25 Print
Shares in Nintendo Co Ltd briefly jumped more than 5 percent after robust holiday sales of Wii and DS game machines helped more than double its quarterly operating profit and prompted it to raise its outlook above market expectations.
TOKYO (Reuters) - Shares in Nintendo Co Ltd briefly jumped more than 5 percent on Friday after robust holiday sales of Wii and DS game machines helped more than double its quarterly operating profit and prompted it to raise its outlook above market expectations.
Operating profit at Nintendo, creator of game characters Mario and Zelda, came to 205.3 billion yen ($1.9 billion) in October-December, up from 100.5 billion yen a year earlier, Reuters calculations showed.
As of 0109 GMT, Nintendo shares were up 3.6 percent at 55,000 yen after climbing as high as 55,900 yen. The benchmark Nikkei average was up 2.2 percent.
JP Morgan said Nintendo's sales and profits continued to outpace its expectations, and it raised its target share price to 80,000 yen from 75,000 yen while maintaining its "overweight" rating.
"Christmas season sales were even stronger than expected for the company's main product lines, including both software and hardware for the Wii and Nintendo DS," JP Morgan analysts Eiji Maeda and Yuko Sekine wrote in a note to clients.
"The company also made progress in cutting costs, particularly by restraining advertising spending more than we anticipated."
The Wii, which features a motion-sensing controller that looks like a TV remote control, the double-screened DS handheld unit and a range of innovative and easy to use games have attracted a wide range of new users including women and the elderly.
Wii sales topped Sony Corp's PlayStation 3 and Microsoft Corp's Xbox 360 in both the United States and Japan last year.
(Reporting by Aiko Hayashi and Nathan Layne; Editing by Hugh Lawson)
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