After a meteoric rise following the launch of Pokmon Go, Nintendo’s share price has fallen abruptly.
The reason? It seems investors have finally heard Nintendo doesn’t actually own the mobile phenomenon.
A Nintendo financial briefing on Friday broke the news that, since it didn’t own the app, any profits from it would be limited, BBC News reported.
Nintendo stock – which had soared by 50 per cent – then dropped by 17.7 per cent as a result.
“Taking the current situation into consideration, the company is not modifying the consolidated financial forecast for now,” Nintendo said. In other words, the company did not expect any change in profit, despite Pokmon Go’s huge success.
The app has stormed to the top of the most downloaded and – crucially – the top-grossing charts around the world.
But, as you likely know already, Pokmon Go has little to do with Nintendo itself. It is made by US-based Google break-away Niantic, based off of that company’s previous AR game Ingress and simply licensed by The Pokmon Company.
Nintendo owns a third of The Pokmon Company and will earn some money from licensing, although how much will actually trickle down remains to be seen.
That’s not to say Nintendo won’t profit from the app’s success in other ways. Animal Crossing and Fire Emblem mobile games are due to launch this autumn and will undoubtedly garner more interest after the huge success of Pokmon Go. The same could be said of this Christmas’ upcoming 3DS games Pokmon Sun and Moon.
Pokmon Go’s success is also a huge signal that well-known IP can work on a mobile device. Nintendo just hasn’t struck gold as a result – yet.