×

Nintendo delays launch of smartphone videogame, shares plunge

115262992KD039_LATEST_ELECT
Getty Images

Japan's Nintendo on Thursday pushed back the much-awaited launch of its videogame service for smartphones by a few months to March 2016, disappointing gaming fans as well as investors who drove its shares down by more than 10 percent.

Under a strategy announced by its previous chief executive, who died of cancer earlier this year, Nintendo had said it would introduce its first smartphone games by the end of 2015. Fans and investors had hoped it would include its best-selling videogame franchise Mario in the first lineup.

Chief Executive Tatsumi Kimishima, a former banker who succeeded Satoru Iwata, said the delay would help Nintendo concentrate on selling its existing consoles and game software during the year-end holiday season.

"The year-end is traditionally our peak season for sales," told a packed news conference, when asked about the delay. "This way, we'd be able to introduce our new applications after the holiday season is over."

He avoided commenting on whether Mario would come to smartphones, instead introducing a new social networking service-style application called "Miitomo" which would be available in March.

The news knocked Nintendo's shares down more than 10 percent in morning trade, erasing earlier gains. DeNA, Nintendo's mobile gaming partner, fell as much as 19 percent.

Read More Pokémon leads Nintendo's mobile charge

Kimishima must avoid cannibalising traditional console sales at the same time as pushing aggressively into the rapidly growing mobile gaming segment. On Wednesday, Nintendo reported a weaker-than-expected operating profit for the July-September quarter on tepid sales of game software.

"This (move into mobile gaming) is a sea change for them and there may be some growing pains like this along the way," said Gavin Parry, managing director of Hong Kong-based brokerage Parry International Trade.

Former CEO Iwata, credited with broadening the appeal of videogames, died of cancer in July just months after deciding to enter mobile gaming despite years of resisting investor calls for such a move.