Embracer Group Quarterly Financial Report: Layoffs, Game Sales, and Future Plans

2023-11-16 10:38:07

The latest financial report of Embracer Group, the parent company of several game groups such as THQ Nordic, PLAION, Gearbox, etc., confirmed that it laid off 900 people (accounting for 9% of all employees) in the past quarter as of September, while the global sales of “Remnant 2” exceeded 200 In Wanfen, the performance of “Payday 3” was lower than senior management’s expectations. Different from the large-scale acquisition of game developers in 2022, Embracer Group’s game business will not be very good in 2023. After announcing a major restructuring plan in June, the latest quarterly financial report showed that the number of the group’s development teams has shrunk from 10,889 to 10,654. There are 36 fewer games under development each year. The financial report revealed that the number of Embracer employees decreased by 5%, with a total of about 900 people laid off. However, in terms of numbers, the financial situation has improved significantly compared with the previous quarter (April to June). Net sales from July to September increased by 13% year-on-year. Nearly US$36 million, adjusted earnings before interest and taxes (EBIT) reached US$170 million, and cash flow reached US$38 million. Chief Executive Officer Lars Wingefors pointed out in a statement that the quarterly performance was stable, thanks to the restructuring plan to achieve cost-saving purposes, and the effect is expected to be more obvious in the second half of the year. Wingefors also said that the layoffs were a difficult decision. “It is never easy to say goodbye to outstanding talents, and I am especially grateful to those who left Embracer this season.” In this layoff storm, including the closed “Saints Row” 》Volition, Campfire Cabal, which was established less than a year ago, and other studios, such as “Star Wars Online” Cryptic, the remake of “Star Wars: Knights of the Old Republic” Beamdog, “Borderlands” series Gearbox, Zen Studios, etc. have been downsized. Extended reading: The parent company made a difficult decision, and “Volition”, the development studio of “Saints Row”, will close immediately. Middle-Earth Enterprises, which was acquired last year, seems to have high hopes from the top management. The company will accelerate the development of “Lord of the Rings” and “The Hobbit”. 》 IP incubation, Wingefors said that the company plans to “tailor-make exciting “Lord of the Rings” IP projects for different market segments in the next few years.” Although it is not certain whether games will be included, the CEO revealed that Embracer had explored signing a new “Lord of the Rings” movie contract with Warner Bros. in February this year, and there is currently no updated development due to the strike at The Hollywood Reporter. Embracer Group’s financial report also revealed that the treasure shooting “Remnant 2” released on July 25 has sold 2 million copies worldwide, contributing to net sales of more than 66 million US dollars. “Remnant 2” was developed by Gunfire Games, a subsidiary of THQ Nordic, and published by Gearbox Publishing. At that time, it defeated “Diablo 4” in a short period of time and successfully topped the US game sales list. In addition, the financial report also briefly mentioned that “Payday 3”, which was released on September 21, received mixed reviews among players. The developer solved the connection matching problem not long after its launch, and earned back the investment cost in this quarter, getting rid of the deficit. Contribute profits to the parent company. Extended reading: “PAYDAY 3” free update will return to the “Cook Off” classic map, and the number of Steam connections is significantly lower than that of “PAYDAY 2”. Embracer originally expected that “Payday 3″ would bring positive contributions in the 2023/24 fiscal year, but the result was ” Lower than management expectations” because “hard-to-prevent errors related to external matchmaking software affected the player experience, causing the initial evaluation to be on the rocks.” The global gaming industry has been quite turbulent recently, and the parent company of Unity, Amazon Games and 505 Games After Digital Bros announced layoffs one after another, Embracer confirmed that it would lay off 5% of its employees. At the same time, Humble Games, the publisher of the charity gift pack Humble Bundle, also announced layoffs. The official did not disclose the exact number of employees.

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