Psycho hit the nail on the head: Nintendo did not invest enough in production of the Wii, and therefore growth is not what it ought to be. If they are lucky they will get a chance to make it up (but they may have to take on debt to get growth back on track), but just as likely the world will move on to something else and Nintendo will lose the motion based controller niche it discovered. On the other hand, the DS is a slam dunk.
"Nintendo did not invest enough in production of the Wii, and therefore growth is not what it ought to be."
Production did expanand this year for the Wii. Just because they are unable to crank out 10,000,000 in a year isn't reason to bitch.
Nintendo will not spend an excess amount money in an attempt to reign in demand. Management is very conservative and has been for quite some time. In the past Nintendo was much easier to buy, I think it even traded on multiple exchanges, however when earnings didn't meet the streets expectations the stock naturally sold off. Management felt the sell off was not justified and literally made the stock avaialble only in instutional size blocks to reduce the volitility as well as the "foreign accessibility".
They have learned from the PS2's success that 3rd party titles are a necessity to their success.
Developing games for the Wii cost developer MUCH less than developing games for PS3 or 360. The Wii is simply a Gamecube with the motion sensors on it. The programing engines for the Gamecube platform still work. . .configuring the motion control isn't as challenging as designing graphics for the PS3 processor. The success of the Wii caught all 3rd party developers off guard (all had / have committed resources for Sony and Microsoft)
Wii Fit will hit the street in February. Gimic or not the Wii Fit will sell millions. To put it in perspective. . .The millions spent on gimicy fat burning pills and stupid stomach crunch machines will only add to the success of the Wii.
A current problem is the sell off of both Japan's market as well as the US. Anything under $70 is a buy for NTDOY.
This quarters numbers will beat expectations and earnings will be ramped up again.
Thinking that Nintendo will need to "take on debt to get growth back on track" shows you can't read a balance sheet.
Since you named yourself pinhead, here is a link to revenue and profit stats: http://investing.businessweek.com/businessweek/research/stocks/financials/financials.asp?symbol=7974.OS No way they can double revenue this year with the underproduction of the Wii, and even the fat margin on games will not double profits YOY, yet the stock is up 125%. Either Nintendo surges production (and revenue) or the stock is way ahead of itself. If Nintendo is serious about capitalizing on their products' popularity, just making enough for Japan is not cutting it. Yet what are they doing with Wiifit? To execute on their success, they need capital, and with interest rates in Japan they ought to be focused on the mass production of their popular products.