Nintendo Plunges After Saying Pokemon Go’s Impact Is Limited | Hacker News Reader

Nintendo Plunges After Saying Pokemon Go’s Impact Is Limited

bloomberg.com

So everyone understands that the short term downloads/revenue would NOT justify the crazy increase in market cap of Nintendo so far.

However, what distressed investor is not the fact that Nintendo didn't adjust quarterly earnings, but the conservative management team refused to signal that they acknowledge the potential of their IP + mobile + new technology such as AR and change their future strategy to be beyond in-house consoles + first party games.

It almost seems to me that their management is embarrassed by the meteoric success of Pokemon Go, considering that they have traditionally been very reluctant of creating contents for smartphones. Now despite their pride, the biggest value jump in their company's history was not lead by any in-house product, but literally a 3rd party American startup writing an app on a platform they traditionally ignored.

I wouldn't be surprised if they are trying to downplay the impact of Pokemon Go just to save face.

Investors, on the other hand, just want to see them acknowledge this potential gold mine and commit a strategy in the future.

Traditional Japanese companies tend not to want short term investors. It is not unusual at all for them to downplay short term success because they do not like volatility in the stock. It might not be obvious since it is game system maker, but Nintendo is a 125 year old company with a very conservative way of doing business.

On the Nikkei, Nintendo has been hovering between 15,000 and 25,000 yen (or about $150-$250 a share). That's about typical for them in the last 20 years. Since you need 100 shares for a minimum order on the Nikkei, that's a minimum investment of $15-25k. In the middle of the 2000's Nintendo faced some criticism for letting its stock price reach 60,000 yen (minimum investment $60k). They were quite happy with this because they did not want casual investors buying their stock.

Basically nothing to see here.

Part of that may be Japanese culture; part of that may simply be Nintendo not caring. They do what they want and most of the time they do an excellent job. Their games are so good that too many mobile games might serve more to dilute their brands than to make them long-term profit.

Yup what a stupid, stupid, company. If only they had the wisdom of Silicon Valley Startups. Then they would be a real company and be able to create innovative and disruptive products that changed the world! \s

You used such strong sarcastic tone as if that statement is so ridiculous, but the truth has been that the Japanese tech industry is in the process of being MURDURED by everyone, from the Americans to the Koreans and to the Chinese.

Sure Nintendo has been able to protect their moat relatively well (after losing their home console castle), but just like the overall Japanese economy, their traditional culture is really limiting how they can compete in today's cutting edge tech markets.

I can't stop wondering if the typo in the all-caps word is intentional. :)

As expected. Pokemon Go proves that Nintendo has tremendous potential to monetize its IP on mobile in the coming years, but investors expected short term bang for the buck.

I can guarantee you Nintendo, as a tightly controlled company, could care less about this volatility.

> I can guarantee you Nintendo, as a tightly controlled company, could care less about this volatility.

couldn't* care less?

Put it on the list with "lowest common denominator" and "begs the question". That battle is lost.

I never feel guilty about sending this along: http://begthequestion.info/

Even if language and idioms change, we need more ways to describe fallacies of circular reasoning, not fewer.

Can you show an example of "lowest common denominator" being misused? I've never noticed it so fear I may be guilty of misusing it.

The correct version is greatest common denominator. The lowest common denominator is usually 1.

Maybe you're thinking of divisor instead of denominator?

They're pretty much the same thing, some fractions are expressed as numerator/denominator

Divisor in the sense of greatest common divisor is not the same as a denominator. More to the point, we may indeed care about greatest common divisors, but we also care about least common denominators (i.e. least common multiples)

Whoops! I usually get this right but apparently not this time. I do appreciate the correction! :)

Off topic but "could care less" and "couldn't care less" are both idioms in common use with the same meaning

"could care less" is a mistake that just grew popular enough to become common use; it doesn't make any sense as a statement since it implies that you haven't hit your care 'floor'.

This may be a bitter pill to swallow, but silly and meaningless idioms are a dime a dozen. When push comes to shove, it's not something worth losing your cool over.

Perhaps they're a dime-a-dozen because they go unchallenged?

I've had junior members of staff express genuine surprise when I've corrected such mistakes in documents. It's a difficult thing to do without offense, but when clear meaning is imperative there's no leeway for doubt.

In 20 years time, will people still understand today's silly idioms or try to read them literally? "Nip it in the butt!"

Idioms survive hundreds of years once established and using them is not a mistake. "Head over heels" is another good example.

Don't worry, I wasn't mashing my fingers into my keyboard in a sweaty rage while typing the above. Life is full of little annoyances, some are fun to comment on though.

Mistake according to what standard?

That standard can't be "doesn't make sense", as a lot of language doesn't make sense

It was "As if I could care less" which is "couldn't care less"

This is not reddit. Your comment adds nothing to the discussion.

Let someone who is pedantic about language, be pedantic. It's not like this is a feature unique to the reddit user base, it abounds on all corners of the internet.

I usually send personal messages when I see this particular error. That's not possible on HN, so I guess a comment is the next best thing. Your downvotes, however, tell me we should just get used to seeing it "could care less" more often.

> I usually send personal messages

why??

> this particular error

It isn't an error, unless you think language has to be perfectly regular and logical with no warts. That's a fantasy. Language develops organically and as such we should expect contradictions and illogical constructions to arise from time to time.

Everyone knows what "could care less" means. There's no external, objective standard by which you can say it's "incorrect". Stop worrying about it.

An example of this type of inversion that has become widespread: in French, "pas" means "not", but originally meant "step", and came into its current meaning via (roughly) the following sequence:

"Je ne marche" (I don't walk) -> "Je ne marche pas" (something like: I don't walk [even a single] step) -> "Je marche pas" (over time, "ne" became dropped in informal speech, and "pas" carries the negative meaning.)

You just blew my mind - never gave a thought to the etymology of "pas". I had to verify it because I simply couldn't believe it.

Come to think of it it also explains how "point" is sometimes used instead of "pas".

Yep, and constructions like "il ne dit mot", "il ne boit goutte", etc., were once much more common than they are today. Not sure why "pas" became the canonical negation word out of all those choices.

I doubt that they don't care about dropping 17% in a single day. Losing 6 billion dollars of valuation in a single day is enough to put heads on the chopping block. It is a staggering amount of money to lose especially with the possibility of getting de-listed in the Tokyo Stock Exchange

But they didn't lose any money. The stock valuation did. Valuation that had recently been inflated due Pokemon Go.

Until Pokemon, Nintendo had been hovering at 15k since the beginning of the year. As of this writing it's at 23220.

All we can take away from this is that Nintendo is still in trouble, just like they have been since before the release of Pokemon Go.

Was it in trouble before?

Yes, the release of the Wii U a few years ago turned out to be a failure, and the sales of the 3DS is dropping off. They have announced their new console, the Nintendo NX, but have released next to no information about it (people don't even know if it's a console or a handheld).

Here's an article about it written before Pokemon Go came out: http://www.ign.com/articles/2016/04/27/why-nintendo-is-in-re...

They didn't lose any money or anything else of value. The wisdom-of-the-crowds appraisal of the value of their company changed. That's it. Nintendo didn't "lose" anything.

This is a Japanese Bigco we're talking about here. Literally no heads are on the chopping block with this.

Perfect example of how irrational the stock market can be. Billions of dollars moved around based on nothing but hype.

It's a pretty sensical and predictable movement though; Nintendo's first real foray into smartphone games becomes the most successful launch ever, leading the stock market to rationally believe that Nintendo will begin to really push their IP into this space and make lots of money. The irrational party is Nintendo, since they now give every indication that the success of Pokemon Go will have no effect on their strategy; the stock market has now responded and said 'we don't think Nintendo will make as much money in future as we'd previously predicted'.

In fact, you're making the same mistake investors did: Believing Nintendo made a foray into smartphone games. Nintendo did not make Pokémon Go, nor is it receiving much profit from it. Niantic, Google, and Apple are all getting the lion's share of the profit, Pokémon Company gets a bit of it too, but then Nintendo only gets a fraction of that.

I may be incorrect, but Pokemon Go was released with Nintendo's approval; meaning they've dipped a toe into smartphone games.

I don't know if it's irrational. If you, or anyone else can be more rational, and predict the market's errors, you could make huge amounts of money.

Predicting errors is hard though. You could have shorted Nintendo's stock after Pokemon go came out. But what if they started announcing more Pokemon games for mobile, and they were also huge successes?

> If you, or anyone else can be more rational, and predict the market's errors

You can't rationally predict irrational errors. At best you could have spotted the trend early and jumped off at the right time, but that is still speculating on the degree of irrationality.

If you can't predict them except in hindsight, well then how can you say it's irrational? If you can't tell me whether or not investing in Nintendo stocks has negative expected value, you shouldn't call people doing it irrational.

Playing against irrational moves in the market in only good in theory. "The market can stay irrational longer than you can stay solvent."

Except it can also exit faster and with a higher magnitude than expected.

The share price exploded from a single free game because it became a social phenomenon.

There wasn't any sort of serious financial analysis going on, just hype.

Of course there was. If a company produces the most successful mobile game of all time, and shows there is a huge interest in one of their IPs, you don't think their stock should be worth more?

If a valuation change without HUGE volume increase of the trades - no billion of dollars moved.

Efficient, actually. Very quickly reallocates resources based on predicted future value.

The predicted future value was based on nothing but hype.

Hype is often the prospect of a huge success, but it always remains a long shot. As another comment said, you can short the stock each time there's a hype according to you and you'll often make a profit--until you don't, and you'll take a very heavy loss.

There are a serious amount of people users, many from a new audience. It is the first breakthrough "Augmented Reality" application, paving the way for a new type of game that everyone can enjoy.

How can you definitively say it is hype or not?

This diagram depicts the real ownership relations for Pokemon Go: http://blogs-images.forbes.com/insertcoin/files/2016/07/poke...

http://www.forbes.com/sites/insertcoin/2016/07/25/nintendo-d...

So is Nintendo saying that they had already calculated the success & revenue from Pokemon Go and its side effects, or are they saying that their original projections are falling short and Pokemon Go saved them?

>> It also said sales of Pokemon Go Plus, a Nintendo-produced accessory for the game, have already been factored into its existing profit forecast.

It's funny how the plunge, a singular event, is now news, rather than the trend over time. sure enough, last week it was the surge, another singular event... short term view presented in market news never stops amusing.

just trying to calm the market by providing the public investors with what they think is a more realistic projection.

Nintendo did not create Pokémon Go, Ninantic did. The game's success is not an indication that Nintendo finally gets mobile.

This is the key point in the article which should be stressed much more.

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