A second failure of the flagship console might have ended Nintendo's run as a hardware maker. Nintendo pulled another rabbit out of its hat. That's the narrative being presented - not a particularly controversial or contrarian one.
This seems to be true of any hardware-based business. Hardware is expensive, has long development cycles, and can't always be fixed with a patch. Maybe they're pulling rabbits out of their hats, but they seem to have an inexhaustible supply. People have predicted Nintendo's demise at least since the GameCube. Somehow, they keep surprising cynics every other hardware cycle.
I am always excited to hear about their consoles because they always do something interesting with the human to computer interface. It also always seems just a bit childlike in its attempts at innovation which I love, and by which I mean "Imagine if you had TWO screens" is something an 8 year old would say with unwavering glee.
It's a sentiment other manufacturers miss out on entirely and that's fine, but I am super glad Nintendo is still around to fill the gap.
It's much riskier if you're in a particular, relatively narrow vertical - there are not a lot of survivors in that business that are pure toy & game makers. Sony could eat the PS3 and a string of unsuccessful portables. Nintendo probably can't. You don't have to be a cynic to be surprised at their continued success - statistically-inclined is enough.
Their history suggests they are happy to pivot. I also don't imagine hardware sales are their bread and butter. Merch alone could probably fund their empire for a bad console or two. They seem fairly well diversified at least within the bounds of their industry.
