Shares of Nintendo Co. took a beating Friday, losing more than a fifth of their value at one point, after the Japanese video game giant announced a worldwide price cut for its new 3DS in an effort to salvage poor sales.

The move spooked investors and analysts, who had expected a quarterly loss but were taken aback by the severity of Nintendo's woes.

The stock fell more than 20 percent in the morning but pared losses in the afternoon. It closed down 12.2 percent at 12,290 yen.

Nintendo on Thursday posted a net loss of 25.5 billion yen ($324 million) in the April-June period, almost on par with its loss a year earlier. Sales during the quarter slumped more than 50 percent.

The numbers forced Nintendo to slash its profit forecast for the full fiscal year through March by more than 80 percent.

The Kyoto-based company blamed its lackluster performance on a dearth of hit titles for the Wii and 3DS handheld device, as well as a strong yen. Analysts say Nintendo's problems run deeper.

The 3DS got off to a solid start when it launched in February to high hopes. But it has fizzled since then. The company moved just 710,000 units in the latest quarter, compared with 3.61 million in its debut quarter. Sales of the regular DS and Wii also fell sharply.

To fuel momentum, Nintendo decided it needed to cut prices just five months after it launched the 3-D version of its popular DS.

The device will cost 15,000 yen in Japan starting Aug. 11, down from 25,000 yen. In the U.S., the price drops to $169.99 from $249.99 on Aug. 12.

JPMorgan immediately downgraded its rating on Nintendo shares to "Underweight."

"The launch of the new 3DS has stalled and the hardware price cut so early into release is an unprecedented act, highlighting that management's...

2011-08-02 01:49:12