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Pokémon GO Success Won’t Immediately Impact Nintendo’s Financial Forecast

After Pokémon GO has rapidly become a worldwide phenomenon, Nintendo’s share price skyrocketed as investors clamoured in response.

Nintendo has now warned that such success won’t immediately impact their financial forecast, and that their expectation for Niantic’s augmented reality app had already been reflected in the forecast that was shared back in April.

“This mobile game application is developed and distributed by Niantic, Inc. The Pokémon Company, which is an affiliated company of Nintendo Co., Ltd., holds the ownership rights to Pokémon,” Nintendo clarified in a notice to investors. “The Pokémon Company is going to receive a licensing fee as well as compensation for collaboration in the development and operations of the application.

“The Company owns 32 percent of the voting power of The Pokémon Company. The Pokémon Company is the Company’s affiliated company, accounted for by using the equity method. Because of this accounting scheme, the income reflected on the Company’s consolidated business results is limited. Also, a peripheral device for use with the application, Pokémon GO Plus, which will be produced and distributed by the Company, is scheduled for release. All of the above are reflected in the financial forecast ending March 31, 2017 as set forth on April 27, 2016.

“Taking the current situation into consideration, the Company is not modifying the consolidated financial forecast for now. The Company will make a timely disclosure when the Company needs to modify its financial forecasts.”

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