Embracer Group Financial Report Confirms Layoffs and Game Performance
In the latest financial report released by Embracer Group, the parent company of several game groups such as THQ Nordic, PLAION, Gearbox, it was confirmed that 900 people, accounting for 9% of all employees, were laid off in the past quarter as of September. This comes as the global sales of “Remnant 2” exceeded 200 million and the performance of “Payday 3” fell below senior management’s expectations.
The report also revealed that Embracer Group’s game business will not be very promising in 2023. Following a major restructuring plan in June, the group’s development teams have shrunk, with 36 fewer games under development each year.
Despite the layoffs, the financial situation has improved, with net sales increasing by 13% year-on-year and reaching nearly $36 million. Adjusted earnings before interest and taxes (EBIT) reached $170 million, and cash flow reached $38 million.
CEO Lars Wingefors called the layoffs a difficult decision, expressing gratitude to those leaving the company. Studios such as “Saints Row” Volition and Campfire Cabal, along with others, have downsized.
Middle-Earth Enterprises, acquired by Embracer last year, will accelerate the incubation of the IP of “The Lord of the Rings” and “The Hobbit”. Although the company’s plans for “Lord of the Rings” projects in the upcoming years are unclear, high hopes have been expressed by senior management.
“Remnant 2” has sold 2 million copies worldwide, contributing to net sales of over $66 million. Conversely, “Payday 3” received mixed reviews among players after its release, falling below management expectations due to issues related to external matchmaking software.
Embracer Group’s financial report also comes amidst a wave of layoffs in the gaming community, with multiple companies announcing downsizings in recent months.
The financial report confirms a mix of success and challenges for Embracer Group, demonstrating a shifting landscape in the gaming industry.