You’ll Never Guess What Happened When Investors Realised Nintendo Doesn’t Own Pokémon Go

OK, so that was a lie. It’s easy to figure out what would happen once investors put two and two together and realise that Nintendo’s direct benefit from the Pokémon Go craze that’s sweeping the world is actually quite minimal.

After its meteoric rise that saw the company market cap double in a fortnight, the company’s shares dropped to the tune of 18% in Monday trading, losing $6.7 billion in value. It’s entirely possible that the company could have fallen further, if not for there being a maximum one-day move of 18% being allowed by the Tokyo exchange.

This follows a statement that Nintendo released on Friday explaining that the release of Pokémon Go and its success wouldn’t see them modify the company’s financial forecasts. This is because Nintendo doesn’t have direct ownership of Pokémon, with a 32% stake in the privately held The Pokémon Company, alongside developer Game Freak and card game creator Creatures Inc. It was The Pokémon Company that holds the ownership rights to Pokémon and they who entered into the licensing agreement with Niantic. It seems that many of the investors that helped double Nintendo’s stock value in the fortnight after Pokémon Go’s release didn’t know this.

Read into that what you will…

Source: Bloomberg, via The Verge

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10 Comments

  1. I can’t imagine many professional traders made this mistake. Japan has a lot of “amateur” traders, mostly general public so they were probably the ones driving the price up and professional traders cashing in.

  2. Did….

    Did TSA just turn into IGN or other clickbait sites for a second? :P

    It sounds like someone forgot to do their research and it’s not like the company behind Pokémon isn’t obvious. I mean, it’s like erm…. actually, i can’t think of something to compare it to. Still, this has to be embarrassing for Nintendo and Pokémon. I wonder if they are going “AAAh, that explains why Nintendo is getting a huge bump in their stock and we got nothing.”

  3. ….Buarharharhar…..

    • …………..Buarharharharhar…………

  4. Wow… I hope someone made a killing from this. Hell, if the other companies are on the stock exchange then people will be looking to invest in them as well, surely.

    • The Pokemon Company is a privately owned company, so no shares to be had there. It’s owned by 3 companies, 2 of which are also private companies with no shares to be had, leaving just Nintendo.

      And the developer, Niantic, was part of Google. (It’s some of the people Google acquired when they bought Keyhole, responsible for what turned into Google Earth)

      So the only company anyone could invest in is Nintendo. Which people did. And probably made a lot of money in a couple of weeks. Assuming they sold all those shares at the suddenly inflated prices.

      • Ah, I feared as much. Still, there’s always money to be made and it’s a very well publicised feather in their cap.

    • I’m sure there were more than a few smart investors that did their research, saw what was going to happen and shorted Nintendo for a nice payoff today.

  5. What kind of investors does Nintendo have for them not to know they own only a 3rd of Pokemon. They look silly, not knowing what they invested in

    • Do they look that silly if they buy some shares and then sell them 2 weeks later for twice the price? Or even sell them now for 50% profit?

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