Nintendo shares have plunged sharply after the company said Pokemon Go‘s success would have a limited impact on its profits.
The Japanese gaming giant’s shares dropped by 17.7% after they more than doubled in value since Pokemon Go’s launch on July 6.
Pokemon Go was developed by American company Niantic and Nintendo said profits from licensing and fees would be limited.
However, even with the decline, Nintendo shares are still up 60% since the release of Pokemon Go.
Overall, Japanese shares traded sideways with the Nikkei 225 index finishing flat at 16,620.29.
Nintendo said the accounting scheme for recognizing revenues from Pokemon Go meant its profits would not materially change.
The sharp drop was the biggest decline since October 1990, the stock down by 5,000 yen – the maximum daily limit allowed.
Nintendo is due to report first-quarter results this week and said it did not plan to revise its earnings outlook for now.
“Taking the current situation into consideration, the company is not modifying the consolidated financial forecast for now,” Nintendo said in a stock filing.
Nintendo shares have seen a stellar rise since the release of Pokemon Go, gaining more than 50%.
Shares shot up 16% on July 13, making an overall increase of 56% since trading closed on July 8 – the day the game became available.
Pokemon Go players search locations in the real world to find virtual Pokemon creatures on their smartphone screens.
The game has become a global phenomenon since its release.
Pokemon Go topped the app store download chart on both iPhone’s App Store and Google Play just days after its initial release in the US, Australia and New Zealand.
Nintendo shares had already started the week with a 25% jump on July 11 alone.
The Pokemon creatures first emerged in the 1990s on Nintendo’s Game Boy device.
For Pokemon Go, Nintendo has partnered with Niantic and the Pokemon Company, which owns the rights to the characters.
Nintendo, which is also behind the iconic Super Mario game, has traditionally relied on sales of its gaming consoles.
However, sales of those have been slowing in recent years as more gamers move online and onto portable devices.
Analysts have long criticized Nintendo for lagging its rivals like Sony and being late to the game in catering to the growing smartphone market.