According to CNN, shares in Nintendo plummeted the daily limit of 18% on Monday after the legendary gaming company told investors that Pokemon Go will have only a “limited” effect on its bottom line.
Why? Nintendo isn’t the only company with a stake in the hit augmented reality game, and it might be earning a smaller share of game profits than investors had expected.
Pokemon Go was actually developed and distributed by a company called Niantic. Both Nintendo and The Pokemon Company, one of its subsidiaries, have invested in the privately-held Niantic.
The three companies collaborated on the game. But Niantic has other investors that stand to profit, including Google.
Nintendo also owns 32% of The Pokemon Company, which controls the merchandising and licensing of the Pokemon franchise. The subsidiary will receive a licensing fee as well as payment “for collaboration in the development and operations” of the game.
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