Saudi’s $700B Wealth Fund Sees Profits Crash 60%—Here’s Why It Matters

Jul 05, 2025

What You’re About to Read Isn’t Just About Saudi Arabia

Hey insiders—

This week, we’re digging into something big. Saudi Arabia’s $700B wealth fund just saw its profits plunge 60%. That’s not a crypto rug pull or a startup gone wrong—that’s one of the world’s most powerful investors feeling the sting of rising rates and inflation.

We’ll unpack what this means for global markets, how deep the fund’s investments go, and why even everyday consumers like us should be paying close attention.

Yours truly,
Kayla, Your Fintech Insider

Saudi’s $700B Wealth Fund Sees Profits Crash 60%—Here’s Why It Matters

The Public Investment Fund (PIF)—Saudi Arabia’s $700+ billion sovereign wealth powerhouse—just reported a staggering 60% drop in annual profit for 2025, down from $38 billion to just $15 billion. This kind of loss would rattle any investor, but when it happens to one of the richest and most globally active funds on the planet? That’s a macroeconomic red flag.

This isn’t just a local Saudi headline. It’s a global story about inflation, interest rates, and the limits of state-backed investing in a tight economy.

What’s Behind the 60% Profit Crash?

Several interconnected factors played a role in this sharp decline:

Higher Global Interest Rates: As central banks like the U.S. Federal Reserve raised rates to fight inflation, borrowing became more expensive. This depressed the value of riskier, long-term investments—like those PIF favors—and squeezed returns across asset classes.
Inflation Pressure: Global inflation drove up costs and reduced purchasing power, causing many of PIF’s portfolio companies to face operational challenges. It also impacted equity valuations globally.
Domestic Spending Commitments: PIF has ramped up domestic spending to fund Saudi Arabia’s Vision 2030 agenda. While this boosts infrastructure and tourism sectors, it also increases short-term costs without immediate returns.
Currency & Market Volatility: With global market swings and commodity price shifts—including in oil, a key revenue driver for Saudi Arabia—PIF’s asset values faced pressure across multiple fronts.

How Deep Is PIF’s Global Footprint?

PIF isn’t your typical investment fund—it’s a key lever of Saudi Arabia’s economic transformation strategy. With stakes in over 70 global companies and participation in nearly every major market, it plays a critical role in shaping industries around the world.

🏎️ Luxury & Automotive

Lucid Motors: PIF owns over 60% of the EV startup and funded the construction of its first overseas manufacturing facility in Saudi Arabia.
Aston Martin: Holds a minority stake as part of its luxury branding and lifestyle portfolio.

🏌🏽 Sports & Entertainment

LIV Golf: PIF’s $2 billion bet to disrupt pro golf by luring top talent from the PGA Tour.
E-sports & Gaming: Investments in Activision Blizzard, Electronic Arts, and Nintendo signal Saudi’s push into digital entertainment.

📦 Tech & Venture Capital

Uber: A $3.5 billion early stake that gave PIF a seat at the table during Uber’s private growth phase.
SoftBank Vision Fund: A cornerstone investor in one of the largest venture capital funds in the world.

🏗️ Infrastructure & Domestic Development

NEOM Project: A $500 billion smart city being built in the desert. PIF is the primary backer, with plans for futuristic transportation, AI integration, and tourism hubs.
Red Sea & Qiddiya Projects: High-end tourism and entertainment megaprojects designed to diversify the kingdom’s economy beyond oil.

Why You Should Care

This profit slump isn’t just about one fund’s bottom line—it’s about the state of global investing in 2024 to now:

PIF is a bellwether. If a state-backed, oil-rich giant is pulling back due to macro pressure, it signals risk aversion across the board. That means fewer splashy startup deals, fewer mega rounds, and more caution from other sovereign wealth funds.
It exposes cracks in long-term strategies. Many of PIF’s investments—especially in EVs and high-growth tech—are long-horizon bets that need favorable conditions to mature. This downturn challenges those timelines and may force reallocation.
You’ll feel it too. Fewer global investments trickle down to slower startup funding, more layoffs in speculative industries, and reduced consumer-facing innovation.

Your Fintech Insider Takeaway

✅ This is more than a 60% drop—it’s a message. High interest rates and inflation are proving to be strong enough forces to shake even the most powerful financial institutions.

✅ Watch where the money doesn’t go next. If PIF delays or redirects future investments, that could signal which sectors are cooling off—especially in tech, clean energy, and sports.

✅ Reassess your own portfolio exposure. If PIF is hurting from long-duration bets and speculative tech, consider where you’re overexposed—and whether cash flow or value plays make more sense in today’s environment.

When $700B moves slower, so does the rest of the financial world. Track the whales, and you’ll see where the current is headed.

Does This Say Something Bigger About the World Economy?

A 60% profit drop in one of the world’s richest investment funds isn’t just a Saudi story—it might be a warning sign.

So we’re asking:

Is this proof that even sovereign wealth can’t outrun high interest rates and inflation?
Is the global economy weaker than it looks on paper?
Or is this just a temporary stumble in an otherwise strong long-term plan?

When institutions with virtually unlimited resources start losing billions, everyday investors should pay close attention.

What do you think—is this a red flag for the global economy or just a reset moment for overambitious investing?

Your Fintech Insider Lens

Discussion about this post