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Nintendo announced that it is cutting sales projections by 70 percent of the Wii U and admitted that the system is essentially a flop.
According to Reuters, the video game company believes that the Wii U console will only sell about 2.8 million units on the year ending on March 31. Projections for its 3DS handheld have also been dropped from 18 million to 13.5 million.
The company also announced that it will likely be operating at a loss of $355.76 million (35 billion yen), which is a dramatic difference from when early forecasts that Nintendo would actually make a 100 billion yen profit.
Nintendo President Satoru Iwata apologized to shareholders and said, "There will be no major management shake-up in the short term."
Myojo Asset Management CEO Makoto Kukuchi noted, "The fact that the 'Wii U strategy' has failed is disappointing and will likely trigger a sell-off as soon as the market opens."
TechCrunch notes that Nintendo has been struggling as it sits between surging popularity of mobile games on tablets and smart phones (especially overseas) and sales from Microsoft and Sony that have snagged more and more of the video game market.
The site suggests problems also stem from Nintendo's latest system not being worth the purchase, especially compared to the next-generations consoles released by competitors this past holiday season.
Nintendo's fortunes have vastly turned from back in 2006 when the company was enjoying the success of the original Wii and was able to stockpile $14 billion in cash.