The strategy of Embracer Group to aggressively acquire studios and IPs has yet to yield major payoffs, but the negative effects continue to pile up. In the Summer 2023 the company announced a plan to restructure, a decision that has so far resulted in a large number of layoffs, studio closers such as Saints Row developer Volition after 30 years, as well as multiple game cancelations.
During the first fiscal quarter, which ended June 2023 the company had 153 unannounced games in development, a number that dropped to 138 games by the end of its second fiscal quarter and shrunk again to 124 as its third quarter ended in December. This is a decrease of 29 unannounced games in total, one of which would have been a new Deus Ex game from developer Eidos Montreal.
In addition, this restructuring has cost a large number of people their employment with the number of jobs cut being 1,387 total in the six months ending in December. This is roughly 8% of their total global workforce. The breakdown of jobs cut includes 871 internal game developers, 252 internal non-developers, and 264 external developers.
Similarly, in December it was stated that the Embracer Group had 132 internal studios, a number that was down from 139 studios earlier in that year. Embracer is also reported to be working with 50 external studios, a number that was down from its previous 59 studios.
Embracer CEO Lars Wingefors stated on Thursday that this restructure plan is entering the ‘Final Stretch’, but warned of more cuts could be coming as they also plan to sell off more assets, such as Borderlands developer Gearbox.
In addition, he stated:
As part of the restructuring program, Embracer still has a few larger structured divestment processes ongoing that could strengthen our balance sheet and further reduce capex. Processes are in mature stages. It’s important to add that certain companies might initiate restructuring before any divestment is announced.
Elsewhere in the company, recently acquired Crystal Dynamics has shown off the first piece of concept art for their upcoming Tomb Raider game. It showcases a modern design of Lara Croft while she was dressed in her classic outfit. There has been no real statement on if this is a continuation of their origin series or a new take, but both look like viable options based on this art. All this is of course moot, given that Embracer could kill the project at any minute because they can.
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