Embracer Group Announces 5% Workforce Cut: Studio Closures, Project Cancellations

Following the collapse of a major deal, Embracer Group (OTC: THQQF) has confirmed laying off 904 employees, constituting 5% of its workforce.

These cuts include the closure of Volition, the studio behind Saints Row, IGN reported. The company announced a reduction in headcount across various divisions and wrote off 15 undisclosed projects across multiple subsidiaries.

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CEO Lars Wingefors emphasized the company's determination to become more efficient but stressed the importance of conducting the process with compassion and integrity. Despite this, Embracer anticipates further layoffs due to ongoing restructuring and potential closures or acquisitions.

Amid these challenges, Embracer noted progress in cost-saving measures and hinted at a consolidation process expected to accelerate soon.

"Process involving possible consolidation of companies and businesses is ongoing, implementation expected to accelerate in [the fourth quarter of this financial year]," Embracer said in a financial presentation. "Our restructuring program is making good progress, with opex savings ahead of plan and capex savings expected to contribute notably in the second half of the year," Wingefors added.

Wingefors remained optimistic, stating: "We continue to take important steps for the future, and I am confident that we will emerge as a stronger company."

However, this assurance might not alleviate the stress felt by the remaining employees, especially going into the holiday season.

Reports suggest the potential closure of TimeSplitters developer Free Radical Design, raising concerns among Embracer's staff. Despite this tumult, some of the company's games, like Remnant 2 and Dead Island 2, have achieved substantial sales success.

Looking forward, Embracer anticipates releasing several games throughout the financial year, including titles like "Homeworld 3," "South Park: Snow Day!," and "Warhammer 40,000: Space Marine 2."

However, uncertainties loom over certain developments, with publisher Plaion yet to comment on reported issues despite requests.

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Image credits: Sergei Elagin on Shutterstock.