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Nintendo who was once "the legendary gaming company" - because of its iconic flagship product NES Console - was seen again creating a bend in the gaming field. With PokemonGo's unstoppable rage, the company's stock grew by 23 percent (remember it was company’s best one-day jump since the 1980s), and market capitalization tripled to 4.36 trillion yen. However, none of this was able to save the company from a loss of $49 million.
Nintendo, the company with 32 percent stake in The Pokemon Company and 13 percent equity in Niantic Labs, released its earnings call. The company posted revenue of $587 million which is 30 percent less than the same period last year. Moreover, it suffered a loss of $49 million (5.13 billion yen) in the last quarter.
It is especially surprising because the market valuation of Nintendo had soared past $40 billion in past few weeks.
However, since the company has not developed the game itself, the overnight success of Pokemon Go was not able to bring a significant financial impact on the company.
Looking back at the history of Nintendo, it has been suffering mainly due to the declining popularity of its gaming consoles. For instance, this quarter, its Wii U console sales saw a further decline as the company sold just 220,000 units, which is 50 percent less than last year.
However, as Pokemon Go has come up with “sponsored locations”, and also has plans of a $30 Pokemon Go Plus wearable accessory - which will hit the shelves in September this year - Nintendo can definitely rely on Pokemon Go, to change its fortunes.
Further, Nintendo is also taking actions to secure its future. Nintendo has entered into smartphone gaming as it released its first Android and iOS game Miitomo this year. The company reported revenues of 1.65 billion yen ($15.6 million) from smart devices products and IP licensing which include Miitomo.
The company is also planning to revive its iconic product- the NES console. It is reportedly developing a miniature version of that console priced at $60.