June 10^th, 2001 (12:00am) - In a research report that was recently released, Merrill Lynch, the big investment firm, has raised their rating on Nintendo from Accumulate to Buy. The reason why ML has upgraded Nintendo status is because of the more favorable approach to Nintendo’s GameCube and Game Boy Advance.

ML believes that Nintendo has learned their lesson from the poor sales with the Nintendo 64, and has put in the effort to correct all their prior mistakes. They also expect a "rich" line of titles for the GameCube’s launch later this year. Also, they took into account the way Nintendo stole the show with GameCube at E3 and the very mass-market price of the console.

Because of this, Merrill Lynch has raised the its expectation of how many GameCube units Nintendo will sell. At first, they thought that Nintendo would only get 1 million units sold by March 2002, the end of Nintendo’s fiscal year (half sold in the US, the other half in Japan). It was been revealed that Nintendo has indicated to them that US distributors have already asked for a total of 4 million units, which was equal to what Nintendo predicted. For the next fiscal year, Nintendo is expected to ship a massive 10.3 million machines worldwide (2.5M in Japan, 5M in the US, and 2.8M in Europe). The reason for all of this is because of the new-founded demand of the GameCube in the US and Japan, the start of sales in the European market, and the increased production of the Flipper chip to 1 million fron 600,000 a month. By the end of the March 2005 fiscal year, shipments are expected to hit 34.8 million, with 25% of that coming from Japan.

Merrill also assumes that Nintendo will lose ¥2,350 for every GameCube unit. The current exchange rate is that a yen is worth $120 US, this means that Nintendo will only lose around $20 per machine which is less than what Sony lost for every PlayStation 2 unit, and is much better than what Microsoft is expected to lose.