Embracer Group is in serious trouble after a major $2000 MDD deal was cancelled. This will force the company to go through a restructuring process that, unfortunately, will be full of layoffs, studio closures and project cancellations.
Through a press release, the company explained its plan to get out of its rough patch and recover. Its goal is to become a self-sufficient and more focused conglomerate. Its restructuring will be carried out in stages with the ultimate goal of reducing risks and, at the same time, growing profitability.
Embracer has a plan to avoid a disaster
Embracer Group's restructuring process has already begun and is expected to be completed by March 2024. To begin with, the company will look to save on overall costs, plan its new strategy, and then consolidate internally.
The company currently has 17,000 employees, but that number will be reduced by the end of the year. Embracer Group did not announce how many people it will lay off, but said that "it is painful to see talented team members leave." Embracer pledged to help affected workers and to be transparent in the process.
On the other hand, the instability will force the company to close or sell some of its studios, as well as pause or cancel several of its games in development.
"It will also include decreased spending on non-development costs such as overhead and other operating expenses. We will reduce third party publishing and put greater focus on internal IP and increase external funding of large-budget games," the developer explained.
It guaranteed that major projects already announced will come through smoothly and that, going forward, it will focus on games yet to be announced. Embracer thanked its employees, studios, industry partners and gamers for all their support.
"As difficult as some of the decisions we will take over the coming weeks and months will be, we are doing this because we are confident that we will emerge a stronger, more efficient company setting out on a stable future to build even greater value across our many studios and fantastic portfolio of IPs.," the company concluded.
Invitation to Embracer Group’s presentation on its comprehensive restructuring programhttps://t.co/958dd8adBA
— Embracer Group (@embracergroup) June 13, 2023
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