Nintendo says it will make 90 billion YEN (£680m) for the financial year ending March 2011, less than half its original estimate.
The firm had been expecting to make 200 billion YEN (£1.5bn).
Nintendo blames stronger than expected YEN appreciation, disappointing sales performance and the 'decided release conditions of 3DS'.
The firm has also slashed its sales forecasts for DS hardware for the financial year ending March 2011. The platform holder originally hoped to sell 30m DS consoles (including 3DS) but now expects to shift 23.5m units. The company has also lowered its Wii sales estimate slightly, from 18m consoles to 17.5m.
In terms of software, Nintendo forecasts 125m DS games will be sold by March 2011, down by the previously expected 150m units. In terms of Wii, the firm says 135m games will be sold as opposed to the previously anticipated 165m.
Nintendo says its net sales for the year should generate 1.1 trillion YEN (£8.3bn), down from the firm's original estimate of 1.4 trillion YEN (£10.5bn).