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Nintendo seeks new partners to increase smartphone line-up

WSJ reports the company is in talks with Gungho and Tencent

Nintendo is seeking new partners to increase its output of smartphone games, the Wall Street Journal reports.

The paper states that the company wants to increase its mobile output beyond the titles it is releasing via partner DeNA, which Nintendo owns a 10% stake in.

The company is reportedly in talks with Puzzle & Dragons maker GungHo, although GungHo denies the claim. Puzzle & Dragons has appeared on 3DS in recent years, including a Super Mario version, so the two businesses have worked together before. In addition, Nintendo is also expected to partner with Tencent to bring its mobile games to China.

Nintendo has made a significant impact in the mobile space, although its revenue success has been below expectations. The company has been hesitant around being too aggressive around monetising its audience due to the risk of angering parents and children. The firm has so far released Miitomo, Super Mario Run, Fire Emblem Heroes and Animal Crossing: Pocket Camp on smartphone devices. Super Mario Run has been downloaded more than 200m times, and is this year's No.1 game on Android. Despite this, the game still hasn't reached an 'acceptable profit', Nintendo said in its last financial call.

It's had more success with Fire Emblem Heroes in terms of monetisation, and although Animal Crossing: Pocket Camp still has some way to go, it's been downloaded more than 15m times so far.

In its financial year, Nintendo generated $176m from its smartphone business, which is below initial analyst expectations.

Nintendo says it expects to release its fifth smartphone game by the end of its financial year in March.

Part of the strategy behind Nintendo's smartphone business is to convert mobile users into Nintendo Switch gamers. Last year, the success of Pokémon Go saw a significant increase in Pokémon 3DS game sales. Early sales momentum behind the new Animal Crossing appears to have had a similar impact on 3DS Animal Crossing games, whereas the new Super Mario Odyssey on Switch became the fastest-selling Super Mario game to-date, less than a year after the launch of Super Mario Run.

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