Now, I'd like to explain the financial forecasts for the term ending March 2010.

About the principal hardware/software forecasts...

We are expecting to ship 30 million Nintendo DS hardware and 180 million Nintendo DS software during the current fiscal year.

Even though less hardware shipments are expected from the previous year, we are not anticipating the shrinking of Nintendo DS hardware business since the average unit price should increase due to the launch of Nintendo DSi.

As for Wii, we anticipate 26 million hardware and 220 million software shipments.

What I would like you to note here in this slide is that while the actual results in the right-hand side include the number of the software that are bundled with Wii hardware sold overseas, the forecasts do not include these bundled software. When we take this fact into consideration, we are actually expecting a 40 million unit increase in our Wii software shipment.

Based on these numbers, we are expecting our sales to be 1 trillion 800 billion yen and our operational profit to be 490 billion yen. We are forecasting the foreign currency exchange rates of 100 yen per U.S. dollar and 130 yen per euro. As we are not anticipating the reevaluation loss which was incurred in the previous year, we are expecting our recurring profit to be 500 billion yen, and net profit is expected to be 300 billion yen.

Looking at these figures, even though recurring and net profits are expected to rise, the sales and operational profit are anticipated to slightly go down.

Some may get the impression that Nintendo's growth, which continued for the last three years, may have finally come to an end.

Contrary to that belief, the reason why the company did not announce an increase in sales and operational profit is due to the impact of the foreign currency exchange rates, not because the sheer size of our business cannot be expanded further. In the previous fiscal year, the average exchange rates were 100.54 yen per U.S. dollar and 143.48 yen per euro. As long as the dollar is concerned, our anticipated 100 yen per dollar exchange rate for the current fiscal year is not so much different. However, our anticipated euro exchange rate of 130 yen per euro differs significantly from the actual average euro exchange rate in the previous year, and because of this, the size of our euro sales, when reevaluated in Japanese yen, must be decreased, which also affect the profits. For example, if our sales in Euro this fiscal year was the same 5 billion Euro as the previous year, this year's sales in Euro can be reduced by 65 billion yen when accounted in yen with this expected exchange rate. By taking such factors into considerations, we are now forecasting almost equal sales in yen for the current fiscal year and aim to increase the recurring profit. This is the current prospect of Nintendo for this new fiscal year.

On the other hand, it is true that Wii in Japan has lost some sales momentum especially from the start of this year. The slow down in Japanese Wii sales have been reported. As for Nintendo DS, while the Nintendo DSi was off to a good start after it launched in November last year in Japan, when we look at the entire Nintendo DS business, it is not selling at the explosive pace it used to have before.

I always quote the data from CESA, but they have not issued the market research data for last year yet. According to other market research companies, the Japanese video game market as a whole is said to have decreased by about 15% in 2008, and there has been less hardware and software sales than corresponding months a year ago in this year so far.

Of course, we do not intend to leave the situation as it is. We are focusing our energy and resources in how to regain the momentum especially around the time when we will be launching strong titles during and after summer of this year.

Yet, under such circumstances in Japan, will the company be able to achieve the high level of shipment targets which are the basis for the financial forecasts? In other words, ...

The key here is for DS and Wii to keep its sales momentum overseas.
So today I would like to talk a bit about the current situations in foreign markets.

This graph shows the market sales in the first quarter of each calendar year, which means January, February and March, based on the data collected by NPD Group in the US.
Comparing last year and this year – no easy task considering the great changes in financial situations – the market has grown in January and February. On the other hand, it reduced in March. I think I have to recognize that the market growth is slowing down compared to the past two years.

But when we divide that graph by platforms, as you can see the red part which represents Nintendo with Nintendo DS and Wii, we are still driving the market even in this year.
But we are not optimistic about the current situation. We anticipate the selling pattern to be different because the launch timing of software titles estimated to drive Wii hardware sales is different from last year; so is how they will sell.

This is the comparison of monthly sales figures of each home console last year to this year, according to NPD group. As I have mentioned in the past, monthly data of NPD has both four-week-months and five-week-months, so these bars show weekly averages.
As you can see for Wii, sales this year have surpassed those of last year in January and February. On the other hand, it lowered from that of last year in March. During March, April and May 2008, Super Smash Brothers: Brawl, Mario Kart Wii and Wii Fit, which drives hardware sales, had been released each month. Simultaneously, as we were able to increase the production amount of hardware in the same period, Wii hardware had been sold in greater amount than usual years. This year, in comparison, hardware sales driving titles will be released in the latter half of the year, starting with Wii Sports Resort in July. Thus figures of April and May are estimated to lower than those of last year, as is Wii hardware, which is estimated to be sold mainly during the holiday season.
On the other hand, compared to the seasonality in sales of past videogame consoles, Wii owes less to the holiday season. We find the reason is the huge loss of chance, with Wii hardware being out of stock during the last two holiday seasons. We are trying to prepare for the holiday season to avoid such situation and to maximize our business.

This is the sales transitions of handheld consoles, also according to the NPD Group. In March, sales figure of DS lowered from last year. We find this is an effect of the launch of Nintendo DSi in April. Actually, I have received reports that in April the total sales figures of Nintendo DSi and Nintendo DS Lite have surpassed that of last year by two folds.
Even though we need more time to figure out what the sales ratio will be for Nintendo DSi and Nintendo DS Lite, as for both Americas and Europe, I feel confident that we are able to maintain the market growth momentum by DS by launching Nintendo DSi while Nintendo DS Lite still has momentum. I believe the DS platform still has a large possibility of growth, which I am going to mention later today.