• Light/Dark

Latest layoffs in Embracer Group come at New World Interactive with roughly 25% of their workforce being affected

Status
Not open for further replies.
Joeyro

Joeyro

Member
Oct 28, 2017
1,763
I'm so confused about Embracer as a publisher. Seems like there was zero planning when they were in their acquisition phase.
 
Messofanego

Messofanego

Member
Oct 25, 2017
26,585
UK
I'm not a business minded person so just curious what laying off people does for Embracer? Is it to reduce costs, like downsizing? So they can keep their profits?
 
gofreak

gofreak

Member
Oct 26, 2017
7,841
Messofanego said:
I'm not a business minded person so just curious what laying off people does for Embracer? Is it to reduce costs, like downsizing? So they can keep their profits?
Click to expand...
Click to shrink...

It'd be a part of this announced program, to in part cut operating expenses by 10%. The program was announced to reach full implementation by 1 Oct, so we're probably seeing some last minute cuts to reach those announced targets.

embracer.com

Embracer Group announces comprehensive restructuring program with immediate implementation - Embracer Group

INSIDE INFORMATION: Embracer Group AB (“Embracer Group”) today announces a comprehensive restructuring program for FY 2023/24, running until the end of March 2024 that includes: Operational and financial measures to increase cash conversion, improve efficiency and reduce capex, reaching a...
embracer.com embracer.com

So basically it's so they can say to the market in a couple of days 'look, we've reached that target we announced, everything according to plan' etc.
 
Faddy

Faddy

Member
Oct 25, 2017
9,217
One thing about all the consolidations in the games industry is that these companies are going to find out they end up competing with themselves for sales and that actually releasing all the games from multiple subsidiaries is not going to generate the maximum returns on paper.

There was an article in February that said Embracer were going to release 94 games within a year.

There is defintely someone in Embracer group asking why they are developing all these games when half of them flop. Just make hits, like that is a thing that can be predicted.

I foresee the same danger in all these mergers. Especially with the size of triple A budgets. There is going to be some perceived clash and the take away is going to be that publishers are undercutting their own efforts. And they shut down the parts that don't bring instant success.
 
Mathieran

Mathieran

Member
Oct 25, 2017
12,926
I'm so sick of seeing all these companies (not just tech) make all these shitty decisions that lead to these (largely unnecessary) layoffs, and the people who made the decisions never have any real consequences. Their bottom line is never hurt, but they'll make hundreds or thousands of people hurt. They just send out their little "I'm sowwy" notes and move on with their life.

We all saw this coming with embracer but the supposed "leaders" who are supposed to be smarter than all of us and make good decisions act so shocked when they lay people off. This isn't about this lay off specifically, just in general.
 
crazillo

crazillo

Member
Apr 5, 2018
8,297
Man, September is ending rough for a lot of game devs. I hope they are landing on their feet.
 
Gavalanche

Gavalanche

Prophet of Regret
Member
Oct 21, 2021
18,503
This is why there needs to be stronger laws against acquisitions. It's crazy that Embracer was able to buy that much and everyone just shrugged. It was as obvious to anyone that this was what was going to happen.
 
Bansai

Bansai

Teyvat Traveler
Member
Oct 28, 2017
11,442
plow said:
If i recall right they planned on getting a huge 2 billion dollar deal by a third party, which didn't work out this year. I suppose many of those aqcuisitions where done with that deal in place.
Click to expand...
Click to shrink...

Yuuup, this really must've thrown a wrench in their gears. That being said, it's still a bit scummy to purchase so many studios while basing a significant chunk of your future strategy on a cash injection that might not happen.

Now that it fell through, they have to let out some blood from their various studios, just enough to balance out the books SOMEWHAT, but not enough to cripple their studios (at least the ones they're not gonna close).

Embracer got too big too quickly, and even with the cash injection I'm afraid they'd still be in the same place, just later down the line. I cannot imagine managing all that talent, crazy.
 
Melhadf

Melhadf

Member
Dec 25, 2017
1,618
Messofanego said:
I would have thought selling off studios would reduce debt more?
Click to expand...
Click to shrink...
Probably has IP related issues, or some rights can be tied to a certain company. By keeping the company they retain the rights to produce those games in future (if they ever do) or lock them in their vaults of IPs from yesteryear.
 
Messofanego

Messofanego

Member
Oct 25, 2017
26,585
UK
Gavalanche said:
This is why there needs to be stronger laws against acquisitions. It's crazy that Embracer was able to buy that much and everyone just shrugged. It was as obvious to anyone that this was what was going to happen.
Click to expand...
Click to shrink...
It just reminds me of gambling, which everyone reminds investments are and it's going to be an unpredictable mess. There should be more regulations and protections for developer studios that get gobbled up. What's the thing called, right of first refusal? So they get choices if Embracer goes belly up, they got other purchasers or being able to own their IP, etc.
 
RelaxedSun

RelaxedSun

Member
Oct 31, 2017
73
Yeah I expect more lay offs today. Forgot they own Dark Horse comics and such. No future Darksiders game. I can feel it.
 
NTMBK

NTMBK

Member
May 22, 2023
774
Doesn't the OP say that New World are hiring, not laying off people? I'm very confused
 
Cassius Africanus

Cassius Africanus

Member
Jun 5, 2023
2,723
I guess this this the part where I do my "smug drive by" according to some posters but the layoffs seem to be affecting many companies regardless of if they own a storefront you don't like. Especially with the news about Sega, and other Embracer studios. It doesn't feel good to say "See I told you so" when people are losing their jobs. As an outsider this industry seems to volatile in its current state. This is a wave hitting all tech companies this year.
 
Gavalanche

Gavalanche

Prophet of Regret
Member
Oct 21, 2021
18,503
AcademicSaucer said:
If the previous owner wamts to sell to them what can you do?
Click to expand...
Click to shrink...

Well, regulatory bodies already exist that in theory stop larger acquisitions and merges; for instance if Samsung and Apple tried to merge they would be told to piss off. So regulatory bodies just need to be more strict. Restrict fast purchasing, put a yearly cap on acquisition numbers, there are plenty of things really. We have seen fast expansion from the likes of Epic, Unity and Embracer recently; and it is now currently biting them in the ass as they are having to downsize. Thats only including gaming, not the movie industry which is its own shit storm. Its at a point where companies need to be protected from themselves, because the people it affects the most are are just the ordinary workers.
 
Status
Not open for further replies.