Borderlands, Deus Ex… Video game giant Embracer lays off workers and cancels fifteen games

By Steve Tenre

Published ,

Embracer has owned Gearbox Software since 2021, which develops the video game series Borderlandsan illustration of which can be seen in this photo, taken at the Gamescom video game show in Germany. INA FBENDER / AFP

The publisher has let go of a thousand employees since the start of its “restructuring plan”, which began at the end of September. However, it had purchased multiple licenses and development studios in recent years.

This is the story of a publisher of video games who had eyes bigger than his stomach. The Swedish giant Embracewhich had acquired in recent years multiple development studios as well as legendary video game licenses such as Dead Island, Deus Ex Or Borderlands, recently announced in a quarterly report that it had let go of 900 employees since the end of September, or 5% of its total workforce. Not so surprising news, as the video game industry faces a wave of layoffs and studio closuresbut which obviously makes people fear gamers future titles whose quality would be degraded.

It is never easy to part with talented people. I would like to especially thank those who left Embracer during the quarter, wrote group CEO Lars Wingefors in this tax report. These are difficult decisions and we do not take them lightly.»And to continue: «We’re not just abandoning a number of studios, we’ve also made staff reductions and reduced project counts at several other studios, with a focus on improving expected ROI on PC and consoles.“Between March and September, Embracer canceled a total of fifteen games,”mainly unannounced projects», reports the specialized media Video Game Chronicles. Embracer should continue its momentum, since its “restructuring plan” is always “in progress“, we can read.

Bulimic group

These 900 dismissed employees and these 15 canceled games in fact constitute only one more step in the great “restructuring plan» announced last June by the group, with more than 15,000 employees. Bulimic, the company, which is not limited to video games but also ventures into comics or board games, had become in the space of a few years one of the symbols of consolidation» in the world of video games. Since the second part of the 2010s, Embracer has continued to increase its acquisitions, taking over multiple development studios, including Tarsier Studios (Little Nightmares), Saber Interactive (Snowrunner, World War Z), but also and above all Gearbox Software (Borderlands ), Crystal Dynamics and Eidos Montreal (tomb Raider Deus Ex). These buyouts are often accompanied by juicy licenses. Thus, Embracer also acquired Middle-earth Enterprises in August 2022, acquiring the intellectual property for all productions related to Lord of the Rings and at Hobbit.

But in 2023, the sweet dream begins to fade when the group fails to get the Saudi investment fund Savvy Games to sign a mysterious partnership which was to bring the Swedish firm two billion dollars. Nip in the bud, the project was nevertheless supposed to cushion “costs already capitalized for a range of big budget games“, Embracer admitted in May. The announcement of this failure caused its shares to plunge on the Stockholm Stock Exchange, losing more than 44% at the close. Since then, Embracer has closed the doors of Volition (Saints Row, Red Faction) last August. The publisher would also seek to sell its golden goose Gearbox, which it had bought in 2021 for $1.3 billion. For the more than 15,000 remaining employees, all that remains is to hope that the group’s next games (Arizona Sunshine 2, Alone in the Dark, Warhammer 40,000: Space Marine 2…) were great commercial and critical successes.

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