Smartphone gaming is not increasing at a rate whereas handhelds will go away anytime soon also.....they have reported losses quarterly but so has Microsoft and Sony in their  gaming divisions ..... Sony as a company has lost billions in the last few years ....At the end of the day Nintendo has always made a profit on there home consoles every generation .....and will make a profit at the end of this generation because of software not hardware you are forgetting software is where the most money is made not hardware ....nintendo IP's sells in the tens of millions....only problem nintendo is having is droughts if they can consistently put out software ....there problems will be less of a problem ...because Nintendos IP's sell look at mario kart 8 

Smartphone gaming is going to collapse in the near future. The whole ecosystem is disastrous and cancerous for actual game developers, and its next to impossible to make a successful expensive title because it will be undercut by derivative rip-offs that work off of the borderline (increasingly in EU) illegal freemium.

Nintendo posted losses because they had been selling both consoles at a loss, and were restructuring as well as investing several hundred billion yen in new facilities for R&D and game development. That has not been the case for a long time now. You are making a basic grade school falacy by trying to somehow tie together entirely seperate cause and affects. Remember, correlation does not imply causation. The 3DS is looking at a smaller market share but its still a large market share, and we have to take into account that it started off terribly because of numerous reasons. There are many things that Nintendo can (and is doing) to make their next handheld system something better than the 3DS.

What's gotten over you? Not only is this thread entirely built on missing the forest for the trees, but now its being filled with nonsensical jargon?

My previous post answers a lot of this, but smartphone gaming is not going to disappear. They may make garbage, but sadly it's profitable and popular garbage, and when people can get their entertainment on their phone for 99c, paying $30 per game on top of $200 for a dedicated handheld becomes an unrealistic sell.

Larger games can survive on consoles, so that's where the fight for Nintendo's long term survival will be fought. And to win that battle, they will have to start acting a lot smarter than they are at present.

Never did I say disappear. I said its going to collapse, and we've been seeing signs of that for a while now as developers constantly try to jump onto that huge cash cow only to come out of it burned or netting un-grandiose profits. Developers with actual talent find that they cannot compete with idea-stealing companies like King and their software like Candy Crush, and if they do try... they get sued. What may disappear is freemium, particularly in not-quite-so-corrupt EU where laws are already going into affect to gut many of the deceitful systems that perpetuate it.

The 3DS has been selling, its not selling great but its been selling. Obviously there is a place for dedicated handhelds. If anything, with the growing strength and cheapness of PCs, its the console that has an ever decreasing place in the world as handhelds become more and more powerful while still strongly attractive to gamers over phones unlike consoles vs. PCs/laptops.

Nintendo does need to start acting smarter... and they have been but the majority of it has been in the background. They are ridding this generation out slow and steady, the WiiU is now profitable and they have little to no production costs (huge storage stocks) this year and every console they sell is profit over losses from the previous two years. They have no need to produce consoles at the moment for the WiiU. The 3DS has two huge titles coming that will push it along and the new hardware refresh will let it chug-along until the end of the generation when they launch their unified architecture and hardware. If anything, while Sony and M$ are pissing millions on exclusivity and parity clauses, Nintendo is making moves to actually survive long term with hardware in some form. (And don't forget that their developer teams and budgets for games are tiny compared to other developers in the market, most of their software will return profits... and some of it will return profits hand-over-fist. Once they streamline their jump to HD, they'll be even more efficient.)

3DS is selling well, but its a big fish in a shrinking pond. The likes of Candy Crush may overrun the quality material, but sadly a market dominated by garbage can still be profitable.

Nintendo's handling of the Wii U still leaves a lot of room for improvement. If they don't get the Wii U version of Smash out by black friday cos of their pedantic OCD fetish for perfection, they'll be seriously damaging the system's momentum and throwing away yet another chance to improve its fortunes. If they have such a problem getting games done on time, they need to hire more people instead of leaving game droughts that rob them of hardware sales. 

They also need to start choosing their projects more smartly, and making games consumers want instead of the games their devs want to make. (Case in point: Tropical Freeze)

Yes, that market WILL be dominated by garbage... which is why its already collapsing in on itself. 

I'll leave the rest be for now.

Garbage doesn't mean commercial failure though; that's what I'm saying; look at Twilight and Justin Beiber.

Yes, that's perfectly true but I'm speaking from the point of view of the game developers.

It is indeed very sad for talented developers. But that doesn't mean it won't happen.