Consolidated Financial Highlights: Nine Months Ended December 2006

Nintendo Co., Ltd. experienced significant financial growth during the nine-month period ending December 31, 2006, driven by the robust performance of its electronic entertainment division. Net sales reached 712.5 billion yen, representing a 72.8% increase compared to the same period in the previous year. Operating income more than doubled, rising 102.5% to 167.6 billion yen, while net income grew by 43.1% to 131.9 billion yen. This performance was bolstered by a 26.0 billion yen foreign exchange gain, contributing to an income before income taxes of 220.7 billion yen.

The primary catalyst for this expansion was the global success of the Nintendo DS handheld platform, which achieved 18.88 million units in worldwide sales during the first three quarters. Strong software sales, led by titles such as New Super Mario Bros. and the Touch! Generations series, further accelerated revenue. Additionally, the launch of the Wii console at the end of 2006 provided a favorable start to the company’s home console business, with software titles like The Legend of Zelda: Twilight Princess contributing to the positive results.

The company maintained a strong financial position as of December 31, 2006, with total assets rising to 1,486.8 billion yen and a capital adequacy ratio of 71.3%. Net cash and cash equivalents increased by 146.3 billion yen over the nine-month period, reaching 763.5 billion yen. Management maintained its previously announced earnings forecast for the fiscal year ending March 31, 2007, projecting net sales of 900 billion yen and net income of 120 billion yen, while noting that these estimates remain subject to market risks and fluctuations in foreign exchange rates.