Sales of Nintendo Co. Ltd.'s (NTDOY) Wii game console have slipped in recent months, prompting speculation the once difficult-to-find console is in line for a price cut.

Since debuting in late 2006, the Wii continued to sell well. Its unique motion controller and casual games gobbled up market share and posted industry-leading sales gains even during traditionally slow stretches of the year, like April through June.

Now that appears to have changed. On Thursday, NPD Group Inc. reported Wii sales posted a 57% year-on-year drop in May, the third straight month of significant declines. The falling sales came despite ample supplies of the once hard-to-find videogame system in retail stores.

Analysts say the slipping sales suggest pent-up demand for the device has finally ebbed, which could put even more pressure on Nintendo to consider cutting the machine's $250 price to be more in line with Microsoft Corp.'s (MSFT) Xbox 360, which retails starting at $199.

A Nintendo spokesman said the company has "no plans to reduce its prices at this time."

On Friday, Nintendo American depositary shares fell 2.4% to $32.20.

Lower sales suggest Nintendo might not meet its forecast for shipping 26 million Wii units for the fiscal year ending March 31, 2010, noted Wedbush Morgan analyst Michael Pachter. That could lead to a price cut to boost sales.

"We expect Nintendo to cut the price of the Wii before the holiday," Pachter noted. He advocates a new $199 price, which would bring the device in line with Microsoft's least expensive Xbox 360 console.

The Wii remains the only next generation console not to have cut its pricetag.

BMO Capital analyst Edward Williams suggests in a note to clients Friday that the Wii "is selling in a more traditional seasonal pattern."

The second calendar quarter is usually a quiet one for the videogame industry, which sees most of its sales come in the latter part of the year and especially during the holiday gift-buying season. Wii sales in the U.S. fell 16% year-on-year in March and 52% in April.

-By Ben Charny, Dow Jones Newswires; 415-765-8230; ben.charny@dowjones.com