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Embracer Group has presented financial results for the fourth and final quarter of fiscal 2024, revealing the impact of a massive restructuring that has left a dark mark on the company. After failing to reach an agreement with Savvy, a Saudi Arabian investment group, the business conglomerate has been forced to make drastic adjustments.
As of March 2023, Embracer Group had 16,601 employees. A year later, the squad has been reduced by 27% leaving 12,069 employees, which represents a decrease of 4,532 workers. Not all of these employees were laid off; According to the company, approximately 1,400 employees, 8% of the workforce, were directly laid off. The rest left the company as Embracer divested some of its assets, such as Saber Interactive, which now operates as an independent entity, and Gearbox Software, acquired by Take-Two.
Cancellation of projects and new structure of Embracer Group
The restructuring has also affected projects in development. As of March 2023, Embracer had 221 games in progress. This number has been reduced to 141 with the cancellation of 80 projects during the year. Despite this reduction, the company maintains a positive outlook for fiscal 2025, expecting to release more than 70 games, including at least “three major titles” that have not yet been announced. Among the planned releases are highly anticipated titles such as Kingdom Come: Deliverance II and Killing Floor 3.
With the restructuring complete, Embracer Group is preparing to split into three independent entities that will go public: Asmodee Group (table games), Coffee Stain & Friends (indie and premium A/AA games) and Middle-earth Enterprises & Friends (AAA games for console and PC). This reorganization, planned to be implemented between 2024 and 2025, aims to improve operational efficiency and better focus each market segment.
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Lars Wingefors will continue to lead Embracer Group, despite taking “a large part of the blame” for the recent realignments. However, Johan Ekström, the chief financial officer, has resigned. The company is confident that the new structure and future launches will allow it to overcome recent challenges and create additional value for shareholders.