Nintendo shares tank as investors realize Pokémon Go to make a ‘limited contribution’
The worldwide success of Pokémon Go recently sent Nintendo shares up over 70% last week, according to IGN. This week is a different story. Upon today’s market closing, Nintendo shares fell 17.7 percent due to the fact that on Friday, Nintendo announced to the non-gamer world of investors that they only have a 32% stake in the Pokemon Co. This equated to a $6.7 billion drop in market revenue Monday alone. The success of the game is unlikely to translate into a large revenue boost for Nintendo as some had guessed.
Even after the decline, shares are still up an overall 60% since the game’s international release on July 6th.
The upcoming release of Pokemon Go Plus has also been factored into their financial forecast. This wearable device will connect to the app via Bluetooth and sends a vibration when a game notification is triggered, allowing the user to stay in the game when not using their smartphone.
Pokémon Go was developed by Google off-shoot Niantic based out of San Francisco. Nintendo and Pokemon Company both own undisclosed stakes in Niantic so it’s unclear how much each company stands to gain.
Others companies however also stand to make huge profits from Pokémon Go. The game broke Apple’s record for the most app store downloads within its first week and is also the top app in the Google Play Store. According to CNN Money, analysts think that in-app purchases could bring Apple a $3 billion revenue boost over the next couple of years. McDonald’s in Japan has made a deal to make most of their 2,900 locations designated PokéStops in hopes of drawing in hungry players.