Saudi Arabia buys part of Nintendo, and not everyone will like it!

Saudi Arabia buys part of Nintendo, and not everyone will like it!

Last week, Nintendo presented its results for the fiscal year 2021-2022. A year marked by stable profits, but a drop in the number of Switch sold, a decline in revenue and game sales that continue to do very well. But a new investor has just entered the capital, and this will not please everyone.

Nintendo: stable financials that interest investors

Between April 2021 and March 2022, Nintendo sold an additional 23 million Switch units worldwide, bringing the hybrid console's distribution total to 107.65 million units. After years of growth, Switch sales are stalling, which Nintendo blames on the lack of semiconductors and the resulting production difficulties.

On the financial side, everything is going well, even if the figures are stagnating or falling slightly. The Kyoto-based firm achieved a turnover of 12.3 billion euros (-0.4 billion), an operating profit of 4.3 billion (-0.3), and maintained its net profit at 3.4 billion. For the coming year, Nintendo expects to sell a lot of games, but "only" 21 million Switch units, which would be a second year of decline.

But, regardless, between the success of Mario Kart 8 Deluxe, Animal Crossing: New Horizons, Super Smash Bros. Ultimate, and upcoming titles such as Mario Strikers: Battle League Football, Xenoblade Chronicles 3, Splatoon 3 and the Breath of the Wild sequel, Nintendo can be relatively relaxed.

Saudi Arabia, a new entrant in Nintendo's capital

This serenity has attracted the attention of investors, and in particular that of the Saudi Arabian Public Investment Fund. Headed by Crown Prince Mohammed bin Salman, this fund has just taken a 5.01% stake in Nintendo after filing a dedicated application with the Japanese Ministry of Finance.

After taking almost total control of SNK and investing in Capcom, Take-Two, Activision and Electronic Arts, Saudi Arabia is pursuing its project, which is officially to diversify the country's economic activity by 2030 in order to anticipate the end of oil exploitation.

A desire for diversification with other objectives

According to Bloomberg, this would make Sudan's FPI the 5th largest investor in Nintendo by shares owned, but Nintendo declined to comment on individual investors. However, according to Kotaku, the investments are primarily intended to reassure foreign companies concerned about the country's human rights record. This additional investment could also provoke reactions from existing investors and the public.

The Crown Prince is also accused of having ordered the assassination of journalist Jamal Khashoggi, which took place in 2018 inside the Sudanese embassy in Istanbul, Turkey. It is also important to note that Sudanese Arabia's investments in entertainment are not limited to video games, as the FPI can be found in Hollywood, but also in sports, with the purchase of the Newcastle club and the cosntruction of a Formula 1 circuit.