The Embracer group, owner of Tomb Raider, still had a catastrophic year in 2023. That’s the least we can say, and the result is not great.
The video game industry has gone through a period of turbulence since the start of 2023, with waves of layoffs and canceled projects affecting many players in the sector. Among them, Embracer Group (which notably owns the rights to Tomb Raider) stood out for the scale of the drastic measures put in place to try to stabilize its finances and reassure its investors. A desaster.
Massive layoffs and canceled projects
As insider-gaming rightly reports, in the space of a year, Embracer Group has laid off around 4,500 employees, or 27% of its global workforce. The move follows the collapse of a multibillion-dollar deal with Saudi Arabia, which pushed the company into drastic cost-cutting measures. At the same time, 80 projects were canceled, reducing the number of current projects from 221 to 141. Luckily for fans, Tomb Raider is not in the mix.
Despite these severe reductions, Embracer recorded a 12% increase in annual net sales, reaching $3.94 billion. This paradox illustrates the company’s efforts to turn around its financial situation, closing studios and selling assets, some of which have been operating for decades.
According to the fiscal report of the year, Lars Wingefors, CEO of Embracer Group, described this transformation as necessary to improve operational efficiency and capital allocation. He stressed that although the decisions were difficult, they were made with compassion and respect for the employees involved.
A complete restructuring for the publisher of Tomb Raider
In April, Embracer announced a major restructuring, splitting the company into three separate entities:
- Asmodee Group
- Coffee Stain & Friends
- Middle-Earth Enterprises & Friends
This reorganization aims to stabilize the company and improve concentration on its various activities. The video game industry now hopes that the situation at Embracer will stabilize and that these measures will allow the company to regain some serenity. The changes made, although painful, are seen as a necessary evil to ensure the sustainability of the company and the continuation of its activities in a constantly evolving market.