Nintendo’s share price has nosedived by 17.7% after investors discovered that the company doesn’t actually own Pokémon Go as many investors first thought.
Pokémon Go has become the most downloaded game of all-time and also sits comfortably at the top of highest-grossing games chart, bringing in several million dollars a day in revenue from its in-game transactions.
Shares in Nintendo rose sharply after the hugely successful launch of Pokémon Go on iOS and Android, soaring by 50% on what they were before the release of Pokémon Go and adding over $11 billion to the worth of the company.
As a result of Pokémon Go becoming a hit worldwide and gaining tens of millions of users within just a few days, Nintendo became a popular choice for investors to invest their money. Investors therefore snapped up shares in Nintendo, increasing the company’s value in the hope of reaping the rewards down the line believing that the company owned the game.
Unfortunately for them, it was revealed on Friday in a financial briefing by Nintendo that they do not own Pokémon Go, and therefore, would not be changing their financial forecast which resulted in investors selling off their shares. If the company did own the mobile game, their forecast would have been modified to reflect the game’s popularity and the revenue it has generated.
“Taking the current situation into consideration, the company is not modifying the consolidated financial forecast for now,” said Nintendo. The company does own a third of The Pokémon Company though which has licensed the franchise which will see some of the profits from the game make their way to Nintendo, but not enough to make them change their financial projection for the year.
Pokémon Go is, of course, developed by a break-away Google company, Niantic.