Nintendo names its GameCube target

Nintendo hopes to grab a bigger piece of the $20 billion video game market by selling 4 million GameCubes

In this story: Target capped only by production Rebound in sight Glowing GameCube reviews RELATED STORIES, SITES

By CNN's Kristie Lu Stout and wire reports

TOKYO, Japan (CNN) -- Nintendo expects to sell four million GameCube units between its November launch and the end of March 2002.

The GameCube home console will be released on the Japanese market September 14 with a price tag of 25,000 yen ($208), followed by its U.S. debut November 4 at $199.95.

Nintendo also reported on Thursday a 42 percent slide in operating profit for the latest year due to weak game sales, but is looking forward to a rebound driven by sales of its new Game Boy Advance hand-helds.

Target capped only by production

Nintendo is set to sell four million GameCubes, hoping to grab a bigger piece of a $20 billion market, taking on Sony's popular PlayStation 2 and Microsoft's upcoming Xbox machine.

"They can easily sell a lot more," Lisa Spicer, a Tokyo-based game analyst at ING Barings, told CNN.

"But it's probably production capacity that led to that forecast. So it is difficult to expect more than that, knowing that it's probably about as much as they can produce right now."

In the next year, the game company also aims to sell 23.5 million Game Boy Advance hand-helds and 77.5 million software titles.

Industry specialists estimate Nintendo will lose $42 - $82 per GameCube unit. But the company hopes volume sales will help it into the black.

"If we achieve our sales targets (of 4 million), we should be able to make an operating profit in the GameCube business this year," said Nintendo's managing director Yoshiro Mori at a news conference.

Rebound in sight

For the year to next March, Nintendo predicted a 25 percent boost in sales to $4.9 billion, but net profit was expected to drop 17 percent to $666 million.

On Thursday, Nintendo reported a 42 percent slide in operating profit to $705.6 million in the year to March, on a 13 percent drop in sales to $3.9 billion.

Analysts said the weaker earnings reflected weak sales of Nintendo64 game machines and the Game Boy's disappointing performance, due in part to a delay in the release of new games in the blockbuster Pokemon series in Europe.

"Demand for Nintendo64 was weak ahead of its next-generation GameCube home video console's launch," said Nintendo's Mori.

"But operating profit will rebound this year with a sales increase and lower depreciation costs related to new consoles."

Glowing GameCube reviews

Nintendo's GameCube enjoyed glowing appraisals from analysts who attended last week's Electronic Entertainment Expo, the game industry's annual trade show, in Los Angeles.

Analysts said gamers would ignore Microsoft's Xbox and opt instead for the creative strengths of Sony or Nintendo, the handheld gaming powerhouse known for its Mario and Pokemon characters.

They say Nintendo's compelling software and $199 price tag, $100 less than both the PlayStation and Xbox, will prove a winning combination.

Earlier this week, the head of Sony's game-making unit told reporters that the game market will be dominated by both Sony and Nintendo, blowing Microsoft out of the water.

"Microsoft has put itself out of the game," Ken Kutaragi told the Financial Times. "Retailers in the US are already disappointed."

"Retailers told me that on a dollar base, they expect 70 percent of their sales to come from PlayStation. The remaining 30 percent will come from Nintendo and Xbox but almost all of that will be from Nintendo."

"The next generation platform belongs to Sony and Nintendo," he added.

Reuters contributed to this report.

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