Embracer has written down 15 projects, says further studio closures and buyouts planned

16.11.2023 - 13:09 / videogameschronicle.com

Embracer Group provided further details about its ongoing restructuring plan during its quarterly earnings presentation on Thursday.

The company announced in June that it was implementing a restructuring programme which would involve the closure of studios and the cancellation of some projects.

It has since shut studios like Saints Row developer Volition and Campfire Cabal, while others have reportedly been put up for sale, such as Borderlands maker Gearbox.

Embracer has also made layoffs at companies including Tomb Raider developer Crystal Dynamics, Knights of the Old Republic remake studio Beamdog, and Pinball FX maker Zen Studios, among others.

On Thursday, Embracer confirmed that the ongoing restructuring resulted in over 900 employees being let go during its second quarter ended in September.

Müge Bouillion, the chief financial officer of Embracer’s board game company Asmodee, who is also serving as finance workstream lead on the Group’s restructuring project, said over half of the staff that left were developers.

She also confirmed that “15 mainly unannounced projects” have been written down across Amplifier, Freemode, Gearbox, Plaion, Saber Interactive and THQ Nordic.

As opposed to write-offs, which reduce value to zero in accounting terms, write-downs can be incremental reductions or partial loss of value.

“At the end of the quarter, the overall headcount was down by 904 versus Q1. This represents a roughly 5% reduction in the workforce,” Bouillion said.

“The reduction was primarily driven by internal headcount, which was down by 713, and this comprised 511 developer and 202 non-developer roles. While this is partly business as usual, the majority is driven by the restructuring programme that we have put in place.”

VGC revealed earlier this month that TimeSplitters developer Free Radical Design is facing closure just two years after it was re-established by Embracer.

While Bouillion didn’t comment on specific studios, she confirmed that further closures and layoffs are planned.

“Since the end of Q2, in respect of due process and commercial sensitivity, we will not comment on the specifics, but further restructurings, closures, buyouts, are in process, and that will lead to additional headcount reductions.”