CyberAgent rises in partnership with Nintendo for mobile gaming

CyberAgent Inc. jumped more in more than 4 years after announcing a partnership with Nintendo Co. to jointly develop smart phone games.

The Tokyo-based mobile games maker's stock increased by up to 16 percent at the start of the trade, the largest amount since November 2013. As part of the agreement, Nintendo will have a 5 percent stake in the subsidiary Cygames Inc. for an undisclosed sum, they said in a statement on Friday. DeNA Co., Nintendo's mobile partner, fell by 5.7 percent after the announcement.

The decision is an opportunity for CyberAgent, one of the most innovative and controversial mobile game developers in Japan. The company's aggressive tactics to monetize its games have given it cash to expand into other areas, including online television. For Nintendo, it's another, deeper push in mobile gaming after falling behind the rest of the segment for years. CyberAgent shares rose 12 percent to a record high of 5,950 yen at 9:47 in Tokyo.

"Cygames is more international, more profitable and focuses exclusively on game development than DeNA," said Serkan Toto, founder of Tokyo. game consultancy Kantan Games Inc.

This summer, Nintendo will release a new role title called Dragalia Lost, co-developed with Cygames, they said. The game will initially be available in Japan, Taiwan, Hong Kong and Macau. The new company has not been taken into account in CyberAgent's earnings forecasts, the company said. CyberAgent announced gains on Thursday that exceeded badysts' estimates.

Nintendo's outgoing president, Tatsumi Kimishima, has hinted that the three-year partnership with DeNA has not delivered as much as the company anticipated. They have jointly released three games – Super Mario Run, Fire Emblem Heroes and Animal Crossing: Pocket Camp – with mixed results.

"I had previously expected smartphone games to become one of our pillars, but that is still an ongoing problem," Kimishima told a news conference on Thursday after reporting the winnings. Nintendo shares rose 2 percent after earnings estimates and a new president Shuntaro Furukawa.


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