It's easy to say now that Nintendo was never in dire straights but it really did look like their dedicated hardware business was in big trouble last gen.
It wasn't just that the Wii U was a flop and that the 3DS was increasingly seeing its lunch get eaten by smartphones as the generation went on, it was more that there was no clear direction for Nintendo to take to come up with a successful console after the Wii U. Going the "power" route became impossible for Nintendo as soon as Sony and Microsoft announced their new hardware and this left only the "innovation" route for Nintendo to take which was a very perilous path after the Wii U failed so incredibly. Nintendo's brand strength fell out of the top 100 for the first time in like 30 years during the Wii U era and kids started to increasingly grow up without knowing who Mario and Link were.
Lots of people on this forum were talking about the "fusion" concept as early as 2014, but this wasn't a guaranteed win for Nintendo. I am really glad that the Switch executed it perfectly and the console is now is working out so well for Nintendo. I will be absolutely clear, though: as a Nintendo fan I was very uncertain about their future in the dedicated hardware business during last gen. The Switch needed to be a success and it is, but it could have easily gone the other way and we are fortunate that it didn't.
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