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Nintendo Shares Plummet, Says Pokemon Go Worthless to It

Image: Nintendo Shares Plummet, Says Pokemon Go Worthless to It

Japanese students play Nintendo's Pokemon Go. (TORU YAMANAKA/AFP/Getty Images)

By    |   Wednesday, 27 Jul 2016 12:10 PM

Nintendo shares plummeted 18 percent, its biggest drop since 1990, after announcing Pokemon Go will have a "limited" impact on the company's bottom line, as Bloomberg put it.

The big one-day fall, $6.7 billion in market value, comes after Pokemon Go's took the world by storm earlier this month and had nearly doubled Nintendo's stock until Friday, adding $17.6 billion in market capitalization, noted Bloomberg.

Nintendo is a shareholder in game developer Niantic Inc. and Pokemon Co., but has just a 13 percent "effective economic stake" in the Pokemon Go app, per an estimate by Macquarie Securities analyst David Gibson, reported Bloomberg.

Reuters reported that Nintendo on Wednesday recorded a quarterly operating loss on a stronger yen and decided to delay the launch of an accessory for Pokemon Go. Nintendo lost 5.1 billion yen, or $49 million, for the quarter from April to June, bigger than the 4 billion yen loss predicted by Starmine SmartEstimate.

CNN Money noted that before Pokemon Go's release, Nintendo sales over the same quarter last year had slumped 31 percent, with a big decline in its Wii U console software and hardware.

Nintendo, though, is still expecting to profit 35 billion yen, or $332 million, for the year ending March 31, 2017, despite the difficult quarter, according to CNN Money.

"I believe Nintendo can leverage the success of Pokemon GO, bringing the game to its consoles or introducing other characters to similar games," Masayuki Otani, chief market analyst at Securities Japan told Bloomberg. "This is just the beginning for Nintendo."

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Nintendo shares plummeted 18 percent, its biggest drop since 1990, after announcing Pokemon Go will have a "limited" impact on the company's bottom line.
nintendo, shares, plummet, pokemon go
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2016-10-27
Wednesday, 27 Jul 2016 12:10 PM
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