Nintendo shares nosedived on Monday by around 18% after the Japanese gaming giant said Pokémon GO's success would have a "limited" impact on its profits. The stock dropped to 23,220 yen (approximately Rs 14,700) in Tokyo, the maximum one-day move allowed by the exchange, Bloomberg reported.
The plunge followed a statement released by Nintendo on Friday, which said the bottom-line impact of Pokémon GO's success will be limited, as it only owns 32% of The Pokémon Company that receives the game's licensing fees, The Verge reported. While Nintendo is the creator of the Pokemon franchise, the gaming app was developed by American firm Niantic Labs, in which Nintendo has invested.
The statement further said that revenue from Pokémon GO Plus – a Nintendo-developed gaming accessory that will go on sale soon – has already been factored into the current guidance, Reuters reported. "Taking the current situation into consideration, the company is not modifying the consolidated financial forecast for now," it added.
The drop in the company's shares was the sharpest since October 1990. The company's market value had more than doubled after the augmented reality-based game was released on July 6. It even surpassed Sony in its market value.
The Kyoto-based firm will present its first-quarter results on Wednesday, July 27. The gaming giant has estimated an annual net profit of 35 billion yen (around Rs 22 billion) in the current fiscal year – more than twice its earnings last year.