Saudi Arabia is reducing its stake in Nintendo

Key conclusions

Saudi Arabia's PIF cut its stake in Nintendo from 7.5% to 6.3%.
The country has been considering increasing its stake in Nintendo, but now appears to be focusing on local investment.
The sales may not signal a shift in Saudi Arabia's commitment to gaming, as it plans to host the first Olympic eSports Games in 2025.

Saudi Arabia State Investment Fund reduced its holdings in Nintendo one more time. Saudi Arabia's PIF has been investing in the gaming industry for years. Over time, he acquired large stakes in gaming giants such as Nintendo, Activision, Capcom and Embracer. The country's continued interest in gaming has led it to host the first eSports Olympics in 2025.

PIF first started investing in Nintendo in May 2022. At the time, it acquired 5.01% of the available shares of the Japanese gaming titan. Saudi Arabia, through its Savvy Games Group division, became Nintendo's largest shareholder in 2023, increasing its stake to 8.26%. The country's continued acquisitions have been aimed at making Saudi Arabia a “global hub” for both gaming and eSports.

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According to Bloomberg (via The Edge ), Saudi Arabia is once again reducing its stake in a Japanese gaming company. All this happened shortly after Savvy Games Group made more than $100 million from the sale of Nintendo stock in October 2024. The Public Investment Fund reduced its stake in Nintendo from 7.5% to 6.3%, according to a filing with Japan's Ministry of Finance. Such a sale is likely to generate even more money for the PIF, although it remains to be seen whether such sales will become a trend by 2025.

Saudi Arabia has previously considered buying additional Nintendo shares

The ongoing selloff in Nintendo stock came as a bit of a surprise. In an interview at Tokyo Game Show 2024, Prince Faisal bin Bandar bin Sultan Al Saud, vice chairman of Savvy Games Group, expressed interest in further investment in Nintendo. The continued sell-off in the gaming company's shares seems to indicate that the PIF is shifting its focus to local investment in the interests of its domestic economy. However, there is nothing stopping Saudi Arabia from reinvesting in Nintendo in the future, especially with the imminent release of the Switch 2 on the horizon.

It's important to note that Saudi Arabia's sudden move to sell Nintendo shares doesn't necessarily mean its commitment to gaming is changing. At the time of writing, the country is still aiming to host the first eSports Olympic Games in 2025. PIF's overall presence in gaming hasn't diminished, and it's still a major contributor to Nintendo. Time will tell if these sales are indicative of a change in Savvy Games Group's overall strategy or just an isolated event designed to generate profits for Saudi Arabia.