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Pokémon GO: Nintendo’s statement about impact on results, forecast unchanged

Following the launch of Pokémon GO, the price of Nintendo’s shares has literally skyrocketted, and even today, it’s still much higher than it was in the past couple of months/years.

The reason? Pokémon GO is not just successful, it’s a real phenomenon: #1 grossing app in a matter of hours in pretty much all countries it came out, insane numbers (microtransactions, daily users, etc.), and more. And of course, there’s the most visible sign of Pokémon GO’s success: the big crowds that always pop up every time a rare Pokémon appears somewhere, especially near big cities.

Even though Nintendo didn’t develop Pokémon GO themselves, investors (and the general public) have attributed its success to Nintendo, which is why share prices have skyrocketted in the first place. But today, Nintendo sent a statement to investors, in order to tell them… to calm down a little bit.

Basically, Nintendo reminded investors that Pokémon GO (launched today in Japan) was developed by Niantic, and that The Pokémon Company holds the licence. Of course, Nintendo does own 32% of The Pokémon Company (along with the Pokémon logo, Pokémon names trademarks, and more), but the good performances of Pokémon GO will only have a “limited” impact on Nintendo’s consolidated results.

Naturally, there’s also the Pokémon GO Plus accessory that Nintendo developed (which is most likely going to be pretty successful, and hard to find pretty quickly). But that, and Pokémon GO itself, were already taken into account in the company’s financial forecasts released on April 27th. Right now, Nintendo sees no need to change their current forecasts for the Fiscal Year, but they will make adjustements later if required.

Basically, Nintendo’s message can be summarised that way: “yes, Pokémon GO is making tons of money, but we only get a “small” portion of that. We’re not changing our forecasts at the moment, because everything was already taken into account when we made our forecast for the current fiscal year.”

Right now, Pokémon GO seems to be performing according to Nintendo’s expectations. If it’s performing even better than they expected, Nintendo is most likely going to wait until enough time has passed to see if they need to change their forecast (and by how much).

The thing with Pokémon GO is that “direct money” (aka. the money the app generates via microtransactions, sponsorships, etc.) isn’t everything. Perhaps more important than that is brand awareness: with Pokémon GO, it’s a bit like the world has travelled back to the late 90’s/early 2000’s, back when Pokémon was considered nothing but a fad.

Now, even people who previously knew nothing about Pokémon not only know about the franchise, but they’re also playing one of its game on a daily basis. The increase in brand awareness is, quite literally, a gold mine for Nintendo, especially on the long term.

But even in the short term, we can already see some positive signs: in the UK, for example, sales of Pokémon games on Nintendo 3DS (along with Nintendo 3DS hardware itself) have increased dramatically last week. On various websites, Pokémon games are selling out, merchandise is “flying out the door” (exact words of a representative from Bioworld Europe), and more.

Long short story short: today, Nintendo sent a statement to tell investors that Pokémon GO should have but a limited impact on its consolidated results. The company isn’t modifying its forecast just now, because everything was already taken into account when forecasts were made, but they will do so in the future if required. That being said, the increase in brand awareness is probably much more valuable to the company, especially in the long term.

NB: if you’re confused about who exactly owns the Pokémon franchise, you can read this great post from vinnygambini!

Source: Nintendo
A big thanks to Ash for the translation of the statement.

Lite_Agent

Founder and main writer for Perfectly Nintendo. Tried really hard to find something funny and witty to put here, but had to admit defeat.

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