Iwata admits that Nintendo’s move to attract casual gamers may have tarnished the company's image

Last week was a bizarre one for Nintendo. Despite outselling the Vita 10 to 1 in Japan, the company also posted its first-ever annual loss.

Wired reports that Nintendo’s President Satoru Iwata places partial blame for Nintendo’s current financial situation on its decision to market the DS and Wii towards casual gamers.

During the question and answer portion of last week’s investors briefing, Iwata said the decision to emphasize "hard-core" games for the 3DS was part of an intentional strategy for the system's image to distance it from the DS and Wii. Specifically, that:

"[R]egrettably, what we prioritized in order to reach out to the new audience [on Wii and DS] was a bit too far from what we prioritized for those who play games as their hobby. Consequently, we presume some people felt that the Wii was not a game system for them or they were not willing to play with the Wii even though some compelling games had been released..."

While Iwata stopped well short of calling the decision to market to casual-core gamers a mistake for the company, his response indicates that Nintendo has learned that it must appeal to traditional gamers with traditional games if they hope to entice more players to their systems.

The strong selection of upcoming titles for the 3DS suggests that 2012 will end strongly for Nintendo, at least on the portable gaming front.

With games like Luigi's Mansion 2, Kingdom Hearts 3D: Dream Drop Distance, Theatrhythm Final Fantasy, New Super Mario Brothers 2, and Professor Layton and the Mask of the Miracle waiting for release in the west, it looks like gamers both casual and hardcore will have plenty of 3DS games to choose from.