If Nintendo, which so far hasn’t introduced a bona fide hit game for smartphones, rolls out more mobile games, net income may top 200 billion yen by 2020, according to Hirotoshi Murakami, an analyst at Mitsubishi UFJ Morgan Stanley Securities Co.
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The correction comes after Pokemon Go’s release nearly doubled Nintendo’s stock through Friday’s close, adding $17.6 billion in market capitalization.
The researcher also noted that searches have spiked at times for various combinations using the word “server” as players attempt to figure out why the game has at times gone down. “We need a little bit more discipline in the rules that purport to be regulating fair disclosure”.
“Pokemon Go” was created by Nintendo and Niantic Labs. Judging by how analysts are expressing skepticism that the video game maker would ever reach the heights that it did at the time, it would appear that Nintendo simply had to break the news to investors in order to avoid a scandal. Nintendo made an announcement about limited profits on Friday, but the game has never featured the Nintendo logo, and Nintendo didn’t claim ownership when the app was announced past year.
The app has a user base of 10 million players, but Nintendo has not disclosed how much revenue it has generated and plans for boosting the app’s earnings going forward.
“Management has left a lot to be desired in communicating adequately”, Mr. Goyal wrote in a note to clients on Tuesday.
The sharp plunge is also, in a way, a testimony to how high the stock price had climbed.
Also, Nintendo said that “Pokémon Go Plus”, its peripheral device for use with the application, is scheduled for release and it’s already reflected in the financial forecast.
For others, Monday’s historic drop looks like just the beginning.
The new interest from short sellers coincides with a sell-off that began last week and gained steam yesterday with an 18 per cent slump, the biggest one-day drop in Nintendo shares since 1990.
Several “Pokemon Go” players were excited to discover that they can finally acquire pocket monsters that are still missing in their collection by dealing with other players.
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Another feature that might make it in the next “Pokemon Go” update is Pokemon breeding, although Hanke said that it is something that the Niantic are still discussing whether they should include it in the game or not.
