Investors are going bonkers over a new smartphone game launched last week by Japanese gaming firm Nintendo Co. On hopes that strong sales of the new game will boost earnings, shares of the maker of Super Mario and Zelda games jumped by almost a quarter on Monday.
Pokémon GO, which was launched July 6, helped Nintendo’s shares soar more than 20 percent on Monday in Japan — adding more than $7 billion in market value — after the stock jumped 9 percent on Friday. Following its launch, Pokémon GO rocketed to the top of free app rankings in Apple’s U.S. iTunes store.
“This is some Nintendo magic,” Serkan Toto, founder of consultant Kantan Games Inc., which specializes in Japanese mobile games, told Bloomberg. “It’s the first time a mobile game has created a buzz like this at least in the U.S. This is basically what Nintendo is all about.”
Monday’s jump was the biggest intraday performance of Nintendo’s shares since 1983 when they listed in Tokyo, Bloomberg reported. Although the company is yet to fully embrace the world of mobile gaming, investors hope that its much-anticipated shift into this segment will eventually pay off.
The game, which has users chasing virtual Pokémon characters through real-life city streets on their smartphone screens, was downloaded onto more Android devices than dating app Tinder within a day of its launch, according to data firm SimilarWeb.
“Despite the substantial success of Pokémon Go in the initial few days since its launch into only three countries, we still view Pokémon Go as a ‘leadoff hitter’ for Nintendo’s foray into mobile gaming,” Deutsche Bank’s Han Joon Kim told Yahoo Finance on Sunday. “We view Animal Crossing and Fire Emblem, slated for fall 2016, and Zelda for mobile possibly coming in spring 2017, as the real big hitters to drive Nintendo to score high in mobile.”
Pokémon GO, which was jointly produced by game developer Niantic and Pokémon Company, was also launched in Australia and New Zealand last week, alongside the U.S. The game is also expected to be released in Japan soon.