Following the breakdown of a $2 billion transaction, apparently, with Saudi government-funded business Savvy Games Group, Embracer Group has announced that it has laid off 904 employees, or 5% of its workforce.
The Swedish company has drawn criticism for the extensive layoffs it made in 2023, which include the closing of Volition, a long-standing Saints Row manufacturer. In a financial report, Embracer stated that it had cut 191 external developers and 713 internal developers (511 developers and 202 non-developers) from its workforce. According to Embracer, a total of fifteen projects, the majority of which were undisclosed, were written down at THQ Nordic, Freemode, Gearbox, Plaion, Saber, and Amplifier.
Las Wingefor’s gratitude to an employee
During a presentation of Embracer’s Q2 financial report, CEO Lars Wingefors expressed gratitude to every employee he let rid of. And he said,
“I want to start this conference by personally thanking the 900 people who left Embracer during the second quarter, before we get into the business details of our second quarter.”
We’re motivated to make Embracer a stronger, leaner organization, as you will hear today. He remarked, “It hurts that you have to leave the group, and we have done everything we can to keep jobs without compromising our goals.”
“The fundamental fiber of Embracer is our people. Personally, I think it’s imperative that the program be implemented with integrity, compassion, and respect.
And it won’t end there either. According to Embracer, continuing buy-outs, closures, and restructuring are underway and “will result in further headcount reductions.” In other words, there will be more layoffs.
Embracer struggles to sell Gearbox
Borderlands developer Gearbox is reportedly up for sale, although IGN sources have said Embracer is struggling to find a buyer at its asking price. Embracer bought Gearbox in February 2021 as part of an acquisition spree that included snapping up Tomb Raider developer Crystal Dynamics, among many other studios.
According to Embracer, “the process involving potential company and business consolidation is ongoing, with implementation expected to accelerate in [the fourth quarter of this financial year].” Wingefors continued, “Our restructuring program is moving along well. Opex savings are ahead of schedule, and capex savings should be a major factor in the second half of the year.” “We are confident that we will emerge as a stronger company as we continue to take important steps for the future.”
Stressed Employees
The hundreds of employees at Embracer are already stressed and anxious as the holiday season approaches, and Wingefors’ remarks won’t make much of a difference. Free Radical Design, the company that created TimeSplitters, is in danger of closing its doors, just two years after it was reopened, according to a VGC article earlier this month.
Embracer Group Continues to Thrive Despite Industry Challenges: Remnant 2 and Dead Island 2 Lead Success, Exciting Lineup of Titles Await Release
Despite the upheaval, a few Embracer games have performed admirably. With over two million units sold and over SEK 700 million (about $66.2 million) in net sales, Gunfire Games’ looter-shooter souls-like Remnant 2 has achieved success. Dead Island 2 by Dambuster Studios was likewise a commercial success.
Homeworld 3, South Park: Snow Day!, Arizona Sunshine 2, Expeditions: A MudRunner Game, Alone in the Dark, Outcast – A New Beginning, Lightyear Frontier, and Deep Rock Galactic Survivors are just a few of the titles that Embracer anticipates releasing within the fiscal year. The company Embracer also owns, Saber Interactive, is developing Warhammer 40,000: Space Marine 2. The external publisher Focus Entertainment has not yet disclosed the date of release.
