Nintendo outguns Sony in market value

Nintendo zipped past Sony in market value on Monday and became one of Japan's top 10 issues for the first time, elbowing the PlayStation maker out of its decade-long dominance of the game industry.

  • E-Mail
By  David Westley and Reuters Published  June 25, 2007

Nintendo zipped past Sony in market value on Monday and became one of Japan's top 10 issues for the first time, elbowing the PlayStation maker out of its decade-long dominance of the game industry.

Nintendo now joins such global household names as Toyota Motor Corp., Honda Motor Co. Ltd.and Canon Inc. on the list of the 10 most valuable Japanese companies. Shares in Nintendo were up 1.5 percent at 46,150 yen by midday, boosting its market value to 6.54 trillion yen ($53 billion), while Sony fell 1.1 percent to 6,480 yen, or 6.50 trillion yen in market capitalisation.

Nintendo's Wii game console has outsold Sony's PlayStation 3 by three to one in Japan and by more than two to one in the United States so far this year, according to game magazine publisher Enterbrain and research firm NPD. Sony's PlayStation 3 entered the Middle East market in April this year. It retails for approximately $650. The Wii was unofficially available earlier in the year. It retails at almost one-third of the price at $250.

Globally demand for its DS handheld game players also far outstripped that for Sony's PlayStation Portable.

"It is becoming quite clear that Nintendo is taking back its market share from Sony in the console market while well defending its stronghold of portable games," Mizuho Securities analyst Takeshi Koyama said.

He said, however, that investors should watch out for a possible pull-back after two year-long bull runs.

"This is one of those companies that is not exactly making daily necessities. One negative factor and shares could take a dive. We need to be careful in dealing with shares like this," Koyama said.

Sony shares have put on 67 percent over the past two years, outperforming the Nikkei average, which rose 57 percent. But Nintendo shares soared more than fourfold over the same period.

Nintendo has offered a slew of innovative and easy-to-use game software such as "Brain Age" and "Nintendogs" for its hardware in recent years, broadening the game-playing population beyond young males to women and the elderly. Sony, which has dominated the $30 billion game industry over the past decade with its PlayStation and PlayStation 2, saw a slow start for the PS3, launched late last year, due mainly to its high prices and lack of attractive software titles. ($1=123.81 Yen)

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code