"Nintendo 3DS has not been selling as expected since the second week [of availability], and this is not just in the Japanese market but also in the US and Europe, where no direct impact from the great earthquake has occurred," said Nintendo president Satoru Iwata.

Video games giant Nintendo has seen its annual profits slump by 66%, hurt by a strong yen and a drop in sales.

"US day-one sales numbers for Nintendo 3DS were the highest of any Nintendo hand-held system in our history," Nintendo said in a statement. The company promised more detailed stats on April 14, when NPD Group will release a report about the month's video game sales.

I fear our business is dividing in a way that that threatens the continued employment of those of us who make games," said Satoru Iwata during a keynote address at the Game Developers Conference in San Francisco. "Is maintaining high value games a top priority, or not?"

Nintendo says it will ship about 1.5 million units of its 3DS console in the first month after debut, promising to avoid the huge shortages seen with the launch of earlier versions, Nintendo President Satoru Iwata told the Nikkei in an interview ahead of the February 26 release in Japan of the device.

Nintendo warned that young children shouldn't play three-dimensional games on a hotly anticipated new game device, citing possible health risks and raising concerns about a technology that many hoped would boost the appeal of 3-D entertainment in the home.

Global sales of Nintendo's Wii console have passed 50 million, the company's boss Satoru Iwata has said. The Wii is now the fastest-selling games console in history, surpassing the PlayStation 2.