Analyst: 3DS Could Rebound, Pricing Crucial For Wii U

In a new note to investors, Wedbush Morgan analyst Michael Pachter gives a cautiously optimistic outlook on the future of Nintendo's hardware plans for the 3DS and the Wii U. In the near term, Pachter is pessimistic that Nintendo's earnings, set to be revealed next week, will live up to expectations. He expects the company is currently well off targets for 11 million Nintendo DS, 16 million Nintendo 3DS and 13 million Wii systems in the fiscal year. 3DS sales in particular are likely well below targets, Pachter said, but he sees "some potential to rebound" with the release of "a number of applications and many strong software releases this fall." The analyst called the unit's recently-added Netflix-streaming function a "key app," likely to be bolstered by the expected launch of stereoscopic 3D movies on the service in the future. As for Nintendo's upcoming Wii U, Pachter said the system has great sales potential, but only if it's "priced competitively with Xbox 360/Kinect bundles." He warned that Nintendo "has conceded a large first-mover advantage given the release of Kinect and Move last year." The note echoes Pachter's comments after the Wii U's E3 unveiling that the system was "two years too late" and that it will "be either a phenomenal success or a phenomenal failure" depending on pricing.