Niantic Labs has announced it will sell its video game unit to Saudi Arabia-based mobile developer Scopely for $3.5 billion, following an effort to replicate the success of Pokémon Go with other AR games. The newly signed agreements include Niantic’s Pokémon Go, Monster Hunter Now and Pikmin Bloom mobile game titles.
Niantic CEO John Hanke said: "Niantic games have always been a bridge between people and inspiring exploration, and I believe that as part of Scopely, they will continue to do both. I firmly believe that this partnership is very beneficial to our players and is the best way to ensure that our games have long-term support and investment, and our games will become the 'forever games' that will last for generations to come."
The acquisition is subject to regulatory approvals and other closing conditions. If the deal goes through, Niantic's Pokémon Go social companion apps Campfire and Wayfarer will also be owned by Scopely. Scopely said it will have access to "Niantic's entire exceptional game production team and category-leading games." However, the Peridot and IngressAR games (the latter of which is also powered by the Wayfarer mapping app) will still be owned and developed by Niantic Spatial.
Pokémon Go attracted more than 500 million players in its first year, but its popularity suffered in 2020 as global Covid lockdowns kept people at home. The company has since canceled multiple projects and laid off at least 310 people between 2022 and 2023 in an attempt to "address current market challenges."
Today's announcement is Saudi Arabia's latest attempt to get into the gaming industry, having previously used its Public Investment Fund (PIF) to acquire stakes in Nintendo, Activision Blizzard and EA. In 2021, the Saudi Public Investment Fund (PIF) was also used to establish the esports and gaming company Savvy Games Group, which later acquired Monopoly Go developer Scopely in 2023 for $4.9 billion.
Scopely's chief revenue officer, Tim O'Brien, said during a Q&A event last year that it would involve "a sizable global franchise that will hopefully do at least $1 billion in revenue." Niantic Labs has not disclosed its profits to the public, but Scopely stated in its announcement that Niantic's gaming business generated $1 billion in revenue last year, and "Pokémon Go" alone has brought in an estimated $7.9 billion in revenue since its launch in 2016.