From the opening weeks of 2023, the gaming industry was hit with a bout of turbulence that’s still rippling through the global market today. Tens of thousands of industry workers found themselves out of a job, age-old studios were shut down, and countless projects were cancelled as developers, publishers, and other industry organisations floundered, panicked, and tried desperately to recoup losses and placate investors.
Embracer Group, which ultimately became the ‘boogeyman of the business’, sat at the top of the table where these cuts and slashes were concerned. In a recent financial update, it was revealed that in the last year, Embracer made more than 4,500 employees redundant and shut down 80 projects.
The Impact of It All
In a recent fiscal report published by Embracer Group, it was almost inadvertently revealed that around 4,500 employees were cut from the company books over the last year. That’s a whopping 27% of the global workforce, and it’s indicative of the vast changes made by the company since 2023 kicked off.
The report also confirmed that 80 projects were closed down. From January to March 2023, 221 projects were underway, but by January to March 2024, just 141 were in play.
Despite the monumental downturn, Embracer reported a full-year net sales increase of a substantial amount – 12% overall, with the monetary equivalent climbing to $3.94 billion. From huge divestments to the closure of studios – some of which had been operating for decades – Embracer tried everything possible to cut costs and recoup finances after the collapse of a multi-billion-dollar deal with Saudi Arabia.
By all accounts from an internal perspective, the transformation of the Embracer Group is nothing but a good thing. That’s the gist of what CEO Lars Wingefors said in the fiscal report:
Throughout the past year, our companies and studios have had to part ways with team members. These were necessary but difficult decisions, and it has been important to carry out the changes with compassion, respect and integrity towards those affected. Post-restructuring, we will strive to make continuous improvements as part of our ordinary business, to further improve operational efficiency and capital allocation.
In April, it was revealed that Embracer Group will be splitting into three separate companies:
- Asmodee Group
- Coffee Stain & Friends
- Middle-Earth Enterprises & Friends
The global hope now is that things have stabilised at Embracer and will continue to stay that way – the industry has suffered enough.
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