Nintendo is now Japan’s second largest company by market capitalisation behind Toyota, driven by the raging success of the Wii games console.

The Kyoto-based company, with a market value which has more than doubled this year to more than Y10,000 billion, has ousted the bank, Mitsubishi UFJ Financial Group, from the number two slot.

This was largely thanks to the 7.33 million sales of Wii players. The console, which offers games that respond to a player's body movements, has outstripped the demand for Sony's Playstation 3 and Microsoft's XBox 360.

Popularity of the handheld DS, especially with women and older users, also helped Nintendo, selling about 13.4 million of the consoles.

Reporting its results for the six months to the end of September, Nintendo said that net profits had doubled to Y132.4 billion (£506 million) from Y54.4 billion a year earlier.

Nintendo raised its profit forecast for a second time. Net income for the fiscal year ending March 31, 2008, will rise 58 per cent to a record Y275 billion ($2.4 billion), the Kyoto, Japan-based company said today. That compares with a July projection of Y245 billion and the Y273.4 billion average of 19 analyst estimates compiled by Bloomberg.

Meanwhile, Sony also upped its game today. The company said it was increasing its sales target for the PlayStation2 game console for the current business year to 12 million units from 10 million.

Sony also upped its target for the PlayStation Portable to 10 million units from the previous estimate of 9 million.

The company said that steady sales of televisions and cameras had offset losses in its video games division during the three months to September 30.

Sony made a net profit of Y73.7 billion in the period against just Y1.7 billion in the same period a year ago, when it was hampered by huge costs related to recalling computer batteries.

All three game makers are gearing up for the Christmas shopping season this year.

Microsoft's Halo 3 shooting title launched in September and helped sell more Xbox 360s than the Wii in that month, the first time this year.

Nintendo is also set to begin selling the Wii Fit exercise game before the end of the year to try to keep its lead.

Sony, which has cut the price of its Playstation 3 to try to win back sales, will also introduce its cheapest version of the player next month in Japan.

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