25 Jul 2016 10:00 AM +00:00 UTC

Pokemon Go Craze May Be Over as Nintendo’s Stock Price Suffers Big Plunge

Niantic Labs' AR game Pokemon Go has only been out a few days, and while the craze in undeniably still felt by players, the feeling may not be shared by stockholders.

When Pokemon Go was first released, Nintendo shares soared its highest to date. That's because it was no secret that Pokemon Go is a franchise under the tech giant's wing. However, given that it is not entirely the financial beneficiary of the game, stock holders appear to have started pulling out from the market.

Bloomberg reported that the stock has experienced a rough setback of 18 percent close in Tokyo with just 23,220 yen. This seems to be the biggest move allowed for a day, but all the same, it had cost US$6.4 billion.

The move may have been the result of a statement released by the company, which directly addresses the expected impact of Pokemon Go on its financial forecast. The notice is short and sweet, and more importantly, drives straight to the point as to what investors may want to know.

"This mobile game application is developed and distributed by Niantic, Inc. the Pokemon Company, which is an affiliated company of Nintendo Co., Ltd. (the "Company"), holds the ownership rights to Pokemon. The Pokemon Company is going to receive a licensing fee as well as compensation for collaboration in the development and operations of the application.
The Company owns 32% of the voting power of The Pokemon Company. The Pokemon Company is the Company's affiliated company, accounted for by using the equity method. Because of this accounting scheme, the income reflected on the Company's consolidated business results is limited."

This basically means that Nintendo is not the sole owner of Pokemon Go. Worse, the current forecasts already included the revenue that will come from Pokemon Go and the accessory Pokemon Go Plus.

Perhaps this bit of announcement came a little too late, though it wasn't really Nintendo's fault to begin with. When you look at it, Pokemon Go has always been tagged with The Pokemon Company first before Nintendo. And most updates are usually independent of Nintendo as a whole. The many partners and names linked to the game may have been the first clue, but then again, it had been a flurry of Pokemon Go craze the past few days.

As far as gamers are concerned though, the excitement continues. Pokemon Go has just arrived in Japan and hopefully, it will only take a few days before it reaches other Asian shores. Eventually, the world. But I guess we've seen its peak as far as Nintendo's stocks are concerned.

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