There is a crisis in the game giant Embracer: The games have been canceled

Swedish gaming conglomerate Embracer Group, which has been rapidly acquiring game studios and popular IPs over the past few years, is undergoing a restructuring. As part of the restructuring process, multiple studios will be closed and several games will be cancelled. Behind this restructuring process is the unexpected collapse of an agreement that would bring the company $2 billion in revenue.

Gaming giant goes to structure

Announcing the restructuring, CEO Lars Wingefors said the process is divided into three phases and will continue until March 2024. The nature of these phases is unclear, and the overall goal is to reduce the debt to less than SEK 10 billion under cost savings and consolidation, which equates to around $930 million.

Embracer states that the cost savings will be implemented “immediately and noticeably” in the first phase. The company currently has 17,000 employees, so an unspecified number of layoffs are expected for now. Saber Interactive CEO and current interim business manager Matthew Karch said the studios to be shut down were “underperforming” or were not creating games “up to our standards.” Embracer Group said the affected projects have “not yet been announced” and have “low projected returns” on investment.

Embracer Group owns the rights to both Tomb Raider and Lord of the Rings. The company bought both giant brands in 2022. Earlier this year, Embracer announced five mysterious Lord of the Rings games in development by outside partners. If we look at Embracer’s statements, the Lord of the Rings game projects will not be canceled. By the way, after the announcement, Crystal Dynamics made a statement on Twitter and confirmed that neither the upcoming Tomb Raider game nor Perfect Dark will be affected by the reconfiguration.

Embracer Group also acquired Tomb Raider when it acquired Eidos, Crystal Dynamics and Square Enix Montreal from Square Enix in 2022, and also acquired Middle-earth Enterprises and licensed The Lord of the Rings and The Hobbit. had its rights. But it is not limited to that. The firm also owns Saints Row publisher Deep Silver.