Niantic Sells Game Division to Scopely for $3.5 Billion, Focuses on Augmented Reality
Niantic, the company behind the wildly popular Pokemon Go, is selling its game division to Scopely, a company owned by Saudi Arabia, for $3.5 billion. Following the sale, Niantic plans to focus on augmented reality and geospatial technology. This acquisition significantly contributes to Saudi Arabia’s ambitions to expand its presence in the global gaming industry.
Niantic’s New Direction
As part of the sale agreement, Niantic will distribute $350 million to its shareholders. Furthermore, CEO and founder John Hanke will lead a new company, Niantic Spatial, dedicated to geospatial AI technologies. This new venture will launch with $250 million in capital, $200 million from Niantic’s existing balance sheet and $50 million from Scopely.
While Niantic achieved massive success with Pokemon Go in 2016, replicating that success proved challenging. Layoffs in 2022 and 2023, coupled with the failure of projects like Harry Potter: Wizards Unite, negatively impacted the company’s financial situation. This sale allows Niantic to move away from the challenges of the gaming sector and pursue a completely different field.
Scopely and Saudi Arabia’s Gaming Ambitions
Scopely was acquired in 2023 by Savvy Games, Saudi Arabia’s public investment fund, for $4.9 billion. This fund is implementing a $38 billion investment plan as part of the country’s strategy to grow and diversify its gaming sector. This acquisition by Scopely will further Saudi Arabia’s goal of becoming a global gaming hub.
Niantic’s move signifies a new direction for the company, with the goal of becoming a major player in the geospatial technology field. The completion of the sale is expected to reshape the landscape of the gaming industry.
