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Pokemon Go-ing Downhill: Nintendo Loses $232 Million in 2nd Quarter

Nintendo’s Pokemon Go Plus accessory has been delayed in the midst of broader concerns about the corporation’s stock valuation.

Since the Niantic-developed Pokemon Go launched earlier this month, Nintendo has received a valuation that is one hundred times its actual earnings, according to Bloomberg’s Reed Stevenson. It’s not hard to see why.

Pokemon Go has been downloaded over 75 million times. For reference, that’s more than double the entire population of Canada. At last count, 20 million people are playing it every day. It’s been driving sales at hundreds of GameStop locations and managed to involve nearly 10,000 strangers in a city-wide crawl. In less than a month, it has made over $35 million dollars — but only about 13 percent of that finds its way into Nintendo’s pockets.

Stevenson believes that Nintendo’s stock may well continue to drop. Many investors seemed to have jumped in without realizing that Nintendo doesn’t actually own Pokemon. Despite holding a chunky 32% share in The Pokemon Company, the house that Mario built doesn’t actually have controlling interest. And while 13% of the monster-fighting simulator isn’t anything to sneeze at, it means that success for Pokemon can’t be applied directly toward Nintendo’s financial future.

Outside of the worldwide monster collection frenzy, Nintendo has been struggling with its in-house products. The 3DS handheld and Wii U home console continue their slow and painful crawl toward death, with a 22% decline in overall sales. Meanwhile, Nintendo prepares to move to the next generation NX project. The stock dip is also being attributed to the strengthening of the yen against the American dollar.

Nintendo has finally abandoned its anti-smartphone stance, planning to release two more mobile titles this year and an additional three by March 2017. And even though it’s very unlikely that other products will gain the same level of traction that we’ve seen from Pokemon, it’s clear that Nintendo is ready to accept the inevitable. It remains to be seen whether the new console and mobile focus are simply too little, too late.

Follow Nate Church @Get2Church on Twitter for the latest news in gaming and technology, and snarky opinions on both.

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