Nintendo Co shares yesterday dived after the release of its Super Mario Run mobile phone game, with analysts citing concern over the high price tag despite the app topping download charts.
Coming on the heels of the Pokemon Go craze this summer, the game was released for iPhone only in about 150 countries on Thursday, a key test for Nintendo’s fledgling foray into mobile gaming.
However, investors pressed the sell button on Nintendo stock, which had soared nearly 12 percent between the September announcement of Super Mario Run’s planned release and Thursday’s close.
Photo: Reuters
Yesterday, the Tokyo-listed shares tumbled 4.24 percent to close at ¥26,405. Earlier in the session the stock fell more than 5 percent, wiping almost US$2 billion off Nintendo’s market value.
Shares in DeNA Co, Nintendo’s codeveloper on the game, plunged 6.78 percent to ¥2,857.
TO THE RESCUE
The game — featuring the iconic Italian plumber trying to rescue Princess Peach — debuted at the top of download rankings in more than 60 countries including Japan, Germany, Australia and Britain, according to market researcher SensorTower.
However, some analysts warned that the nearly US$10 price tag to buy the full version — the initial stages are free — could scare away some customers. Pokemon Go is free.
Moreover, Android users will not be able to buy the new game until a later date.
“Having a fixed price tag means profit will be limited because smartphone games make big money through free-to-play features,” Iwai Cosmo Securities Co analyst Tomoaki Kawasaki said.
It is unclear how much the game will impact Nintendo’s finances.
“Some investors who may have overestimated the expected revenue from downloads seem to be disappointed,” Daiwa Securities Group Inc analyst Takao Suzuki said.
“Super Mario Run was in the top spot in download rankings and in sales in many European countries, while in the US it is number one in downloads, but seventh by revenue,” he said.
“Sales in the US leave a bit to be desired,” he said.
The shares may continue to struggle next week, Suzuki added.
“But I don’t think they will keep sliding further... It seems that short-term investors sold their shares. For longer-term investors there is no need to be concerned,” he said.
MOBILE MOVE
Nintendo refused for years to move into smartphone gaming or license its characters for online play.
However, in March, Nintendo released its first mobile game, Miitomo — a free-to-play and interactive game that allows users to create avatars. Then the Pokemon Go game — based on Nintendo characters — exploded on to the market, sparking a phenomenon as it was downloaded more than half a billion times.
Additional reporting by Bloomberg
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by