News
News Categories

Pokémon Go's popularity adds US$ 9 billion to Nintendo's market value

By Ashley Lucas & Koh Wanzi - on 12 Jul 2016, 12:10pm

Pokémon Go's popularity adds US$ 9 billion to Nintendo's market value

Pokémon Go, Nintendo’s hotly-anticipated augmented reality game, is doing wonders for the company. Its stock price increased by 9.3 percent after the game launched last week, a rise that was followed by a 24.52 percent jump on Monday to ¥ 20,260.

The game has already topped app download charts in regions where it has been officially released, which currently includes the US, Australia, and New Zealand. Local users will be able to install the game through certain workarounds, like switching to the Australia version of the App Store for iOS users, or downloading the APK if you’re on Android. However, it looks like the servers have been taken back down, although they went live briefly.

Nintendo isn’t the only party responsible for the game, though, and the app was actually made by Niantic, an augmented reality game maker that was originally a part of Google. The game itself was then built together by Niantic and the Pokémon Company, both of which Nintendo has invested in.

Having said that, the app is free to download and Nintendo makes money from in-game microtransactions.

In the US, the game already pulls in roughly US$ 1.6 million in revenue daily from in-app purchases according to some estimates. But in order for it to have a tangible impact on Nintendo’s profits, Pokémon Go may need to generate as much as US$ 140 to US$ 196 million in turnover each month.

The question now is whether Nintendo will be able to retain the interest of players and continue to attract new users. Stock price is a poor indicator of future success, and the release of the Nintendo Wii in 2007 similarly helped the company’s stock climb to new heights, as well.

Pokémon is one of the most popular game franchises in the world, but there’s no guarantee that players will stick around if new features aren’t added.

Source: The Wall Street Journal