NEW YORK (CNN/Money) - After reining in sales forecasts and cutting prices on its Xbox video game system last week, Microsoft Corp. said Monday that the co-founder of the Xbox, Seamus Blackley, has resigned.

Blackley worked at the video game division of movie studio DreamWorks before joining Microsoft as head of its advanced technology group. A company spokeswoman said he is leaving to pursue other opportunities, but did not elaborate.

Video game rival Nintendo answered Microsoft's price cut in Europe and Australia with a price reduction on its GameCube system. Nintendo said Monday that GameCube, which hits the market May 3, will sell in Continental Europe for 199 ($177), down 20 percent from the original price. In the United Kingdom, the cost will fall 24 percent to £129 ($186.7).

Microsoft (MSFT: Research, Estimates) said Thursday that it cut the retail price on the Xbox by as much as 38.5 percent in Australia and Europe in an effort to boost sales.

During a Thursday conference call, John Connors, the company's chief financial officer, acknowledged that Xbox sales have not been as robust as Microsoft had hoped, and he lowered the company's unit shipment forecast for the current fiscal year.

Connors backed off the company's previous target of shipping between 4.5 million and 6 million consoles by the end of June. "Based on our current view of the business, we believe that Xbox shipments through June will likely be in the 3.5 million to 4 million range," he said.  

--from staff and wire reports