Japan’s GungHo Hits $10 Billion Market Cap

Dr. Serkan Toto is a gaming expert and independent consultant based in Tokyo. You can follow him on Twitter and his blog. This article is republished with his permission.

There is no end to the Puzzle and Dragons hype in Japan, it seems.

The country’s top smartphone game now has over 12 million users, is generating a staggering US$62 million to $86 million per month, and has been advertised with a new campaign on national TV since the end of March.

Maker GungHo (3765.OS) has just announced a Nintendo DS version of the RPG/puzzle hybrid game for later this year, in addition to the release of a spin-off dubbed Puzzle and Dragons Challenge for iOS and Android a few days ago. both titles are for Japan only at this point.

And recently, the company rolled out a Puzzle and Dragons English version on Android (here is the iOS version that came out late last year).

GungHo is listed on the Osaka Stock Exchange, and I have pointed out how their market cap has risen over the last few months (driven almost exclusively by Puzzle and Dragons’ growth) quite a few times in the past.

As a reaction to the two Puzzle and Dragons spin-offs and the new English-language Android version of the game, GungHo’s stock price went through the roof.

After adding close to 15 percent in a single day, GungHo’s market cap now stands at a mind-blowing US$9 billion (Editor’s note: It’s $10 billion as of now). In that area, GungHo destroys every mobile game company out there, including:

• DeNA ($4 billion)

• GREE ($2.8 billion)

• Zynga ($2.4 billion)

With over $10 billion, GungHo’s market cap exceeds that of national airline ANA, Daihatsu, Mitsubishi Motors, Sanyo Electric, NEC, or Sharp: that’s what one successful smartphone game – a potential new billion dollar franchise – can trigger on the Japanese market.