The gaming giant reveals a lofty goal of creating a more self-sufficient and ‘highly cash-flow generative’ company, which means studio closures and yet-undetermined staff reductions.
Embracer Group, the gaming giant that acquired the lofty Lord of the Rings IP back in 2022, has announced a lofty restructuring program, with the goal of creating a, “leaner, stronger and a more focused, self-sufficient company,” said Lars Wingefors, Group CEO of Embracer Group, in an open letter posted on the company’s website.
“During the past years, Embracer invested significantly both in acquisitions and into a strategy of accelerated organic growth,” added Wingefors. “We have acquired some of the world’s leading entertainment IP and we have invested into one of the largest pipelines of games across the industry. The program presented today will transform us from our current heavy-investment-mode to a highly cash-flow generative business this year. 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. The program will lower our net debt significantly. After completion of this program, we will generate growth in profitability with less business risk and with higher margins in the PC/Console segment over the coming years. This, in turn, will give us the freedom to continue to grow and deliver the high-quality experiences our players really value.”
The impending program will be implemented by former board member and Saber Interactive CEO Matthew Karch, just appointed Embracer Group COO, who will work alongside Crystal Dynamics – Eidos CEO Phil Rogers, the new CSO. Studio closures and lay-offs are soon to follow, although the exact numbers have yet to be revealed.
More details will be shared as the program unfolds.
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