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Nintendo Shares Plunge 17% After Saying Pokemon Go’s Impact Is Limited

H

hongcha

Member
http://www.bloomberg.com/news/artic...unge-after-saying-pokemon-go-s-impact-limited

Nintendo Co. shares plunged after the company said late Friday that the financial impact from the worldwide hit Pokemon Go will be limited.

Shares sank 17 percent as of 10:48 a.m. in Tokyo, wiping out $6.3 billion in market value. The company cannot fall more than 18 percent today in Tokyo, as per exchange rules on the maximum a stock can move per day.

The correction comes after Pokemon Go’s release in early July almost doubled Nintendo’s shares through Friday’s close, adding $17.6 billion in market capitalization. Nintendo is a shareholder in the game’s developer Niantic Inc. and Pokemon Co., but has an "effective economic stake" of just 13 percent in the app, according to an estimate by Macquarie Securities analyst David Gibson.

In a press release after the market closed on Friday in Japan, the Kyoto-based company said the game’s financial impact will be "limited" and that it doesn’t expect to revise its annual forecast higher based on "current conditions." It also said sales of Pokemon Go Plus, a Nintendo-produced accessory for the game, have already been factored into its existing profit forecast.

“The content of the announcement itself is not that shocking, but it is a surprise they said it on Friday instead of when they report earnings” later this week, said Nobuyuki Fujimoto, a senior market analyst at SBI Securities Co. “The game has been published in Japan, so for the time being we’ve exhausted all the catalysts.”
Click to expand...

More at the link.

EDIT/UPDATE:

crinale said:
http://headlines.yahoo.co.jp/hl?a=20160725-00000537-san-bus_all

It looks like stock went down to limit (for a day only though). It also took related shares along with and they went down severely also.
Click to expand...
 
V

Venfayth

Member
Even if they don't make money directly from the app, surely the cultural craze surrounding it will bring some positive energy to the Pokemon brand?
 
O

OrbitalBeard

Member
If only Nintendo had gone 100% all-in on mobile, instead of diversifying, like some on GAF have suggested over the past couple weeks.

lol
 
P

Protann

Member
Just goes to show how little some of there people know about the shit they invest in. PokeGo isn't even technically a part of Nintendo's mobile initiative.
 
V

Vena

Member
Venfayth said:
Even if they don't make money directly from the app, surely the cultural craze surrounding it will bring some positive energy to the Pokemon brand?
Click to expand...

Of course, but the surge in stock was nothing short of lunacy. It was impossible to maintain irregardless of the scenario.
 
M

McDougles

Member
They're really burying the lede that is this photo.

-1x-1.jpg
Click to expand...
 
S

Squire

Banned
foxuzamaki said:
People in the stock market is so goddamn fickle
Click to expand...

Nintendo isn't?

"This thing that's exceedingly profitable to the point of being a global cultural phenomenon won't have a great impact on our business"

Shareholders reacted accordingly. Like, what on earth were they thinking to say that?!
 
P

Phamit

Member
I never understood why people thought this is big for Nintendo, when their name is only visible really small in the corner, alongside the other parts of the pokemon company
 
J

JohnTinker

Limbaugh Parrot
I hope that they release another batch of the 20th Anniversary New 3DS bundles in North America. I was fortunate enough to find one when it released, and I can't tell you how many people who down own a 3DS have told me they would buy the same bundle in a heartbeat. Ought to have those rereleased bundles out in late August and then flood the market with a Sun/Moon 3DS bundle to capitalize on the craze.
 
SinCityAssassin

SinCityAssassin

Member
Squire said:
Nintendo isn't?

"This thing that's exceedingly profitable to the point of being a global cultural phenomenon won't have a great impact on our business"

Shareholders reacted accordingly. Like, what on earth were they thinking to say that?!
Click to expand...

How is being honest about financial expectations being fickle?
 
D

diaspora

Member
Squire said:
Nintendo isn't?

"This thing that's exceedingly profitable to the point of being a global cultural phenomenon won't have a great impact on our business"

Shareholders reacted accordingly. Like, what on earth were they thinking to say that?!
Click to expand...
They might have assumed it to be obvious as it should to anyone who isn't catastrophically stupid. It doesn't make sense for this to be a key revenue stream.
 
AmuroChan

AmuroChan

Member
For every one smart, knowledgeable person who buys stocks there are 100 who don't really know what they are doing. Pokemon Go's limited impact on Nintendo's financials is not some secret insiders information, but of course, the average Joe probably thinks that 1) Nintendo developed the app and 2) Nintendo owns Pokemon outright.
 
S

Sandfox

Member
And now we wait to see what effect AC and FE have lol.

Squire said:
Nintendo isn't?

"This thing that's exceedingly profitable to the point of being a global cultural phenomenon won't have a great impact on our business"

Shareholders reacted accordingly. Like, what on earth were they thinking to say that?!
Click to expand...

I'm pretty sure Nintendo can't lie to investors.
 
V

VGChampion

Member
jacks81x said:
For every one smart, knowledgeable person who buys stocks there are 100 who don't really know what they are doing. Pokemon Go's limited impact on Nintendo's financials is not some secret insiders information, but of course, the average Joe probably thinks that 1) Nintendo developed the app and 2) Nintendo owns Pokemon outright.
Click to expand...

I've been playing Pokemon since the beginning and was hyped to play it before it even came out and I still find it weird that Nintendo doesn't own Pokemon outright. :p
 
Chobel

Chobel

Member
Was Nintendo legally obliged to state that impact of Pokemon Go is "limited"? Because if not, someone really fucked up.
 
SinCityAssassin

SinCityAssassin

Member
Chobel said:
Was Nintendo legally obliged to state that impact of Pokemon Go is "limited"? Because if not, someone really fucked up.
Click to expand...

They're legally not supposed to lie about their financials. And nipping the bud on something that isn't happening in reality (that a lot of people including some of us thought was happening) i.e having a huge impact on financial forecast is something they need to do in order to avoid a much larger fallout later on.

I mean sure they COULD say it had SOME sort of impact on their revenue, but it'll hurt harder when people find out it's not as big as they were led to hope.
 
M

Madao

Member
well, makes sense since this thing will be forgotten before the year ends.

stock holders cashed their checks at the right moment.

edit: seems like the only potential big hit that they 100% own is a mobile Mario game. it's weird how they still haven't announced anything regarding that.
 
W

wmlk

Member
VGChampion said:
I've been playing Pokemon since the beginning and was hyped to play it before it even came out and I still find it weird that Nintendo doesn't own Pokemon outright. :p
Click to expand...

Pokémon is as big as it is because of Nintendo's partnership and also TPC's own creative endeavours.
 
M

Manmademan

Member
Yeah a lot of us were saying that Nintendo didn't actually have a large monetary stake in the game profits, but kept getting shot down by diehards who swore the take was in the 30 to 40% range. That never made sense.
 
Cynn

Cynn

Member
Squire said:
Nintendo isn't?

"This thing that's exceedingly profitable to the point of being a global cultural phenomenon won't have a great impact on our business"

Shareholders reacted accordingly. Like, what on earth were they thinking to say that?!
Click to expand...
Maybe because Nintendo feels forced into mobile and didn't develop the game so they minimalize its importance? Mobile success might threaten the NX's support. Who knows.
 
S

Steve Youngblood

Member
Cynn said:
Maybe because Nintendo feels forced into mobile and didn't develop the game so they minimalize its importance? Mobile success might threaten the NX's support. Who knows.
Click to expand...

I think the far more likely scenario is that there is pressure to be transparent on this because misleading investors isn't a very prudent thing to do both for legal or moral reasons. I highly doubt they are downplaying the amount of money they are making from this to prop up their core business.
 
Q

qko

Member
More interesting is the fact that they apparently expected this to happen. I know Pokemon is popular, but to conquer the mobile app stores to this degree? It's madness.
 
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