Embracer Group cut 27% of its workforce in the last year

Embracer Group's latest financial reports have revealed significant cuts to its workforce.
embracer group financial results 2023

Embracer Group’s latest financial report has revealed shocking statistics about the company’s transformation process over the last year, including that 4,532 employees have been let go since March 2023 – amounting to 27% of the total company workforce. In addition, the report has revealed that 80 in-development game projects have been cancelled.

Per details included in the report, the company’s transformation is now complete, after months of cuts – but what a transformation it’s turned out to be. Just short of a third of the company’s entire staff have been let go, as a result of poor management.

Embracer Group seemingly had high hopes for the future pre-2023, with promises of a major USD $2 billion deal, reportedly with Saudi Arabia’s Savvy Games, inspiring a spending spree that saw the company snap up a variety of studios it seemingly couldn’t afford to support.

Read: Embracer’s failed $2bn deal was reportedly with Saudi Arabia’s Savvy Games

Notably, Embracer Group reported a net sales increase of 12% in the full year between April 2023 to March 2024 – but this has come at a major cost, both tangible and intangible. Thousands of developers have been put out of work in the last year, and their most creative ideas have been lost in the process. It’s unlikely we’ll ever know what every one of Embracer Group’s 80 cancelled games were, but they represent a vast collective loss of passion, talent, and insight.

“It has been a transformative year for Embracer,” CEO Lars Wingefors said in the financial report. “The restructuring program, that is now successfully finalised, has created a stronger foundation for improved profitability, cash flows and long-term value creation.”

“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.”

As you’d expect from an investor-facing report, the topic of redundancies was not particularly dwelt upon, beyond acknowledging the need to treat employees with respect and integrity. Rather, Embracer’s financial reports look solely towards the future.

In this future, the company will split into three separate groups defined by their output – Asmodee, “Coffee Stain & Friends” and “Middle-earth Enterprises & Friends.” According to Wingefors, these companies will “boast sufficient scale, coherent strategies and a clearer focus” paving the way to “unlock value” in Embracer’s biggest assets.

There is every chance that Embracer management has learned from its biggest mistakes over the last year, and that it will treat employees with more consideration than a few lines on a balance sheet going forward, but we’ll have to wait to see what eventuates. We can always hope for better, even in circumstances such as these.

Leah J. Williams is a gaming and entertainment journalist who's spent years writing about the games industry, her love for The Sims 2 on Nintendo DS and every piece of weird history she knows. You can find her tweeting @legenette most days.