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In Nintendo's position I would'n kill the whole hardware department entirely, but at least make drastic changes.

Producing and offering handhelds as long as they remain profitable . Keeping the WiiU in the stores for many years ahead (for the clientel that absolutely wants a Nintendo home console), but instead of putting many billion yen in R&D for a new home console go multiplat in that segment.
Offering multi-platform games and also highly profitable accessories: Wiimotes, Nunchucks, Pro controller (perhaps even a cost-reduced and improved version of the tablet-controller as accessory) for PS4 / PS5 / Xbox One & Two / PC, which guarantee the "100% Nintendo experience" on these platforms. The games would also run with the standard controllers, but partly with restrictions. Marketing the hell out of the improvements when using the nintendo accessories.

Similar for the mobile market (iOS + Android): offering games on these platforms that work fine with touch controls (after the timed exclusivity on 3DS and successor runs out). More complex mobile games would also be offered (again the 3DS or successor would have a timed exclusive window), but for these games  a Nintendo-certified controller-extension would be mandatory.