Nintendo suffered an 18 percent drop in Tokyo Exchange last Friday after investors realized the company does not fully own "Pokemon Go." (Photo : Getty Images/Bloomberg)
Since the launch of "Pokemon Go," Nintendo's market share went skyrocketing alongside the global phenomen the GPS-based game was able to produce. Just a few hours ago, its shares plummeted after investors realized the company does not fully own the game.
The stock went down to 18 percent at the close in Tokyo, which is the maximum one-day move allowed by the exchange. The sudden drop removed $708 billion yen in the market value. Although Nintendo is a shareholder of the said game, it only has an "economic effective stake" of 13 percent according to Macquarie Securities analyst David Gibson, Bloomberg reported.
After closing on Friday, Nintendo released a statement saying they only own 32 percent of the voting power of the Pokemon Company which actually develops and distributes the "Pokemon Go." They also pointed out the company income reflected on its results are "limited."
They also stated that the upcoming "Pokemon Go Plus," which is a peripheral device of the "Pokemon Go" is yet to be produced and distributed by the company in the future. All sales of the said device will be accounted in a separate report that will end on March 31, 2017. The company further said they will not be making any modifications to their financial forecast as of the moment and will inform public once they do so.
The company will be reporting on Wednesday about its first quarter earnings which is expected to be around 35 billion yen, as forecasted by the firm. This figure is more than twice of the 16.5 billion yen the company earned last year.
Aside from Nintendo, Bloomberg also reported that other related companies also fell like McDonald's Holdings Co. Japan, the game's exclusive partner, declining to around 12 percent. Hosiden Corporation, the company who is rumored to be produced the "Pokemon Go Plus," also dropped 16 percent.
On the other hand, "Pokemon Go" is already starting to roll out in Asia as it debuted in Japan over the weekend. More than 10 million people have already downloaded the game in Japan and has already become a phenomenon in the said country.
For readers who are interested in other "Pokemon Go" details, watch the video clip below.
