Nintendo admits it's not making much money off 'Pokémon Go', loses $6.7 billion in market value

The story of Nintendo's surging share price this July has been a real stock market fairy tale — the company's value more than doubled after the global success of Pokémon Go, even though the game is made by a different company, the San Francisco-based Niantic. 

Surely Nintendo, the publisher of the original Pokémon games on Game Boy, must feel some benefit of the new game's success?

Well, not really. In a statement [PDF link in Japanese] Friday, Nintendo said the impact of Pokémon Go on its finances will be "limited," explaining that it only owns 32 percent of the Pokémon Company, which owns the intellectual property rights for the Pokémon franchise. 

Furthermore, even though Nintendo plans to start selling a game-related peripheral under the name Pokémon Go Plus, the financial impact from that operation has already been factored into the company's previously announced earnings forecast. 

None of this is really new, but it appears to be news to investors, which initiated a frantic selling session Monday, with Nintendo's stock price falling 18 percent (the maximum a stock can drop in one day on the Tokyo stock exchange), wiping some $6.7 billion in market value.

Nintendo's stock price is 65 percent higher than it was prior to the Pokémon Go launch.

Despite the correction, things aren't looking too bad for Nintendo. The company's stock price is some 65 percent higher than it was prior to the Pokémon Go launch on July 6, and its quarterly earnings, which will be announced this Wednesday, are forecasted to be significantly better than last year according to Bloomberg. 

The game is expected to launch a couple of mobile games of its own, and a new console called the Nintendo NX is about to be launched in March 2017. 

As for Pokémon Go, following a successful launch in Japan last week, the game has just been launched in Hong Kong. Obvious next stop is the enormous market of China, but a launch there may never happen as the game needs access to GPS data which is restricted in the country.

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