While the company isn’t happy about the situation, the executive told BBC Radio 4’s Today programme that there are still “plenty of opportunity” to reach new audiences, and said that innovations like 3DS will drive consumer interest.
"We've had very good years," he said, adding that falling demand for consoles “is part, I suppose, of the cycle, the whole industry as such. We're not recession proof. We've probably as an industry been better than other industries”.
The interviewer then said Nintendo had to admit that sales of Wii and DS - which have sold 12 million and eight million units in the UK - have peaked.
"We obviously would like to be selling more and it has declined. But the whole market has as well so it's not just ourselves," Yarnton replied. "We think there's still plenty of opportunity for the product. There are a lot of people still waiting to get into gaming because I think there’s a lot of interest from older people, people that normally didn't game, and we've got some innovations on the way as well.”
The interviewer – who wasn’t too clued up on the subject of gaming – then asked why Nintendo hasn’t got any new products coming out, suggesting 3DS is just a simple variation of the DS, and saying that Microsoft and Sony would have shiny new consoles on the market by Christmas that would render Nintendo’s obsolete.
Yarnton said of 3DS: “I think it's quite a leapfrog, actually, [compared] with the other [DS] product. Especially when you look at the other technology out there in TV and movies, where with 3D you have to wear glasses, whilst with our 3D offering you don't have to wear glasses.
And of rival products from Microsoft and Sony: "There are no real new models coming out as such. No leapfrogging. They're just derivatives of the original versions they've had. We still with Wii have got a lot of technology we haven't fully harnessed and a lot of development coming of games that I think will still wow people when they see it."
Yarnton also rejected suggestions that Nintendo has been forced to slash prices to maintain Wii sales. "The actual price, when we launched Wii in 2006, recommended retail was about £179. We don't set the price [retailers do] and that price hasn't changed."