Embracer To Cancel Games And Close Studios As Part Of Major Restrucuring Program

Embracer Group has announced today that it's embarking upon a restructuring program that will have a major effect throughout the company, with job losses, cancelled games and studio closures expected.

In a statement, Embracer's CEO explained the move will "make us a leaner, stronger and a more focused, self-sufficient company", allowing for the ability to achieve "higher margins in the PC/Console segment over the coming years".

"During the past years, Embracer invested significantly both in acquisitions and into a strategy of accelerated organic growth. 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."

As a result of the restructure, Embracer says that staff numbers will be affected, but it's too early to give an exact forecast. There will also be cuts to game development, including studio closures and cancelled / postponed games.

"The actions will include, but not be limited to, closing or divestments of some studios and the termination or pausing of some ongoing game development projects. It will also include decreased spending on non-development costs such as overhead and other operating expenses. We will reduce third party publishing and put greater focus on internal IP and increase external funding of large-budget games."

"The potential impact from the program of future game releases will almost entirely be around unannounced projects. All announced significant releases will still be released as planned."

For those who aren't aware, Embracer currently owns a whole host of popular development studios including Gearbox Software, Deep Silver, Flying Wild Hog, Aspyr, and many others.

Crystal Dynamics is part of that list as well, although the company took to Twitter earlier today to reassure fans that the next Tomb Raider won't be affected by the news, nor will the studio's work on Xbox's upcoming Perfect Dark reboot.

If you're interested in reading the full statement, you can check it out on the Embracer Group website.

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