Nintendo won't hit their forecasts. How did they get them so wrong?

[Purple]

Mr Khan said:

Max King of the Wild said:

Purple said:
Nintendo never believed they'd hit those targets. Setting high targets gives investors the illusion that you are selling a product that will be highly desired by the market. When Nintendo fails to hit those targets, Iwata will make some lame excuses and make it seem like the only reason they failed to hit those targets is some outside factor beyond their control.

You'll hear some absolute gems come then end of the financial year. Iwata will definitely blame Western markets (this plays well with the xenophobia of Japanese investors) and don't be surprised if the old 'bad weather' excuse comes out again. He'll then apologize and pretend that the company will learn from its mistakes.

nice hypothesis but the negativity and backlash of missing the forcast greatly outweigh the illusions 

Agree. You don't want to lowball too badly to show a lack of confidence in your product, but to vastly overestimate makes you seem deluded, unless there's something political at play in terms of Japanese investor relations that i don't know of.

The bigger question here is that Nintendo's been making way off-base predictions for like 3 years now. I don't get how they're still getting away with it.

As I mentioned above, it's been going on way longer than 3 years. It has to be a business strategy. I can't see any other reasonable explanation.

Edit: I think it's based on the theory that exaggerating sales expectations gets new investors on board and share prices go up. When they fail to meet these expectations, share holders are reluctant to sell because people don't want to sell when shares are falling (better to hold on and sell when the share price goes up).