Nintendo mobile partner DeNA books $450 mln writedown as gaming business falters

DeNA Co

05/02/2020 10:33

By Sam Nussey
    TOKYO, Feb 5 (Reuters) - Nintendo Co Ltd's  7974.T  mobile
partner DeNA Co Ltd  2432.T  said on Wednesday it was booking a
49.4 billion yen ($450 million) writedown as its gaming business
falters in Japan's saturated mobile market.  
    DeNA booked a 40.2 billion yen loss on goodwill related to
U.S. gaming unit Ngmoco and a 8.1 billion yen loss on software,
with the company saying it expects to report a loss in the year
ending March.
    DeNA has partnered with Kyoto-based Nintendo on mobile
titles including Mario Kart Tour, which has been widely
downloaded since its September launch. But it has yet to become
a big revenue driver as it was not offered with a multiplayer
option from the outset.
    Another title, Pokemon Masters, which was developed in
partnership with Nintendo-backed The Pokemon Company, has not
lived up to expectations. 
    Given DeNA's mobile titles already include high profile
franchises like Pokemon and Animal Crossing, it is hard to see
how the company will reenergise its gaming business, said Serkan
Toto, founder of game industry consultancy Kantan Games. 
    The results comes as analysts question partner Nintendo's
commitment to mobile, which remains a small contributor to
overall sales despite the company's pledges to expand beyond its
core business centred on the Switch console.  urn:newsml:reuters.com:*:nL4N2A00XU
    With Japan's mobile market increasingly centred on a small
number of hit titles, gaming companies are closely guarding
their title pipelines, creating difficulties for investors in
gauging their prospects. 
    One runaway hit is Dragon Quest Walk, from Square Enix
Holdings Co Ltd  9684.T  and Colopl Inc  3668.T , which offers
Pokemon Go-style outdoor play and has proved wildly popular
since its September launch. 
    

 (Reporting by Sam Nussey; Editing by Kim Coghill)
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