Layoffs, Studio Closures, And Game Cancellations Are Coming To One Of The Biggest Publishers
Embracer Group, the gaming giant that owns Borderlands studio Gearbox, the rights to The Lord of the Rings, and Tomb Raider studio Crystal Dynamics, is making some drastic-sounding changes to its business setup. The company on Tuesday announced a «restructuring program» that aims to help make the company «leaner, stronger,» and «more focused [and] self-sufficient.» Layoffs, studio closures, and game cancellations are coming as part of this.
The announcement of these moves comes not long after Embracer said it lost a $2 billion deal at the 11th hour. Embracer said it only had a verbal agreement for this deal, but it was still a major loss. What role the loss of this deal had on the restructuring plan is unknown, hosaodver.
CEO Lars Wingefors made the announcement in a memo shared with staff and posted on the company's website. He said in recent years, Embracer has been on a journey of growth, and indeed, Embracer made so many acquisitions and investments in the past five years that it became something of a meme to be «embraced» by the company.
That period of massive, accelerated growth is now over. Wingefors said the «restructuring» will transform Embracer from «heavy-investment mode» to becoming a «cash-flow generative» company.
«It will enable us to meet the worsening economy and market reality as a strong company and it will fundamentally change our prioritization of growth with raised capital towards optimization and growth based on our own cashflows,» Wingefors said.
The executive said Embracer's net debt will be lowered through the move and, if all goes to plan, Embracer will have greater profitability with less business risk in the coming years. «This, in turn, will give us the freedom to continue to grow and
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