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Embracer Group’s $3.9 billion full-year sales

1.5-billion-dollar debt remains

Embracer Group

Swedish video game and media holding company Embracer Group has just declared its financial report for the past fiscal year and the results are pretty interesting. Despite a slow last quarter, the holding group’s overall sales showed a slight increase compared to the previous year.

The sales report showed a net of 42.2 billion SEK (Swedish Krona) which translates to around 3.9 billion USD (U.S. Dollars). This is an increase of 12% compared with figures from 2023.

The increase comes in spite of the fact that the report indicated a 5% decrease for the most recent quarter – ending March 31, 2024 – for a sales figure of $830.9 million when converted to dollars.

Overall, Embracer’s debt now sits at a staggering $1.53 billion (16.4 billion SEK) and continues to rise from 2023’s figure of $1.46 billion (15.6 billion SEK). The Swedish video game mogul has undergone some serious adjustments lately, which saw over 1,400 employees let go and several studios shut down or sold. Embracer’s report also revealed that the company’s CFO and deputy CEO Johan Ekström is set to step down shortly.

As far as numbers go, they break down as follows: For the full 12 months of sales ending March 31, 2024, Net sales reached $3.9 billion (42.2 billion SEK) which is a 12% increase from 2023.

PC & Console game sales came in at $1.3 billion combined (14.4 billion SEK) for an increase of 7%. There was a 2% increase in mobile games for a total of $550.9 million (5.9 billion SEK), while sales of tabletop games also improved by 13% to $1.4 billion (7.1 billion SEK).

Embracer’s entertainment and services sector saw the biggest increase of 34%, for a full-year total of $662.9 billion (7.1 billion SEK). However, despite the sales increases across multiple media platforms, Embracer’s net debt increased to $1.53 billion, as mentioned above already.

Despite the overall increases across the board, past quarter sales (January – March 31, 2024) saw decreases in multiple sales figures. Net sales dropped 5%, PC & console sales dropped 10% combined, and Entertainment and services dipped by as much as 15%.

Mobile games sales increased slightly by 4%, while tabletop games only increased by 1%. With that said, tabletop games are one avenue Embracer is looking to recoup some of its debt throughout this year.

Two of the past quarter’s best-selling games were Deep Rock Galactic: Survivor and Tomb Raider 1-3 Remastered. Thanks in part to its availability on Xbox Game Pass, Dead Island 2 was one of the biggest sellers for Embracer this past year, with over three million units sold and a player base peaking at over seven million players.

Other recent releases such as South Park Snow Day and Alone in the Dark performed within expectations but weren’t blockbuster hits by any measure. Nevertheless, things are looking up for Embracer as over 70 titles are expected to be released within the next 12 months, with Kingdom Come: Deliverance 2 and Killing Floor 3 pegged as pivotal titles.

There have also been rumors of at least three as-of-yet unannounced titles to be coming soon, as well as expectations for more PC and console games from both new IPs and established franchises in the near future.

In response to its fluctuating financial figures, the Embracer Group indicated much of this had to do with the company’s reorganization shakeups and the related sales of Gearbox Entertainment and Saber Interactive. The layoffs and restructuring of the company are of particular note.

By the end of March 2023, the company went from 16,601 to 12,069 total employees. The number of game developers fell from 11,426 to 7,699. While the number of development projects fell from 221 to around 141. These figures have continued to drop since then and are something to keep an eye on across the entire gaming industry moving forward.

All in all, the Embracer Group CEO Lars Wingefors stated that it is happy with the current financial improvements in both earnings and cash flow and is on track to go ahead with its plan to split the company up into three publicly-listed enterprises later this year.

Like many video game and tech companies of late, the Embracer Group has undergone a radically transformative year but is confident of its long-term ability to continue to create great games while also increasing profitability.

Just like the recent statements made by Microsoft about its extensive layoffs, the Embracer Group also felt that parting ways with so many team members was the right move based on the current state of the gaming landscape.

They have vowed to continue to make changes and improvements for the betterment of the industry, but with so many layoffs and a serious amount of corporate greed and lack of innovation and creativity rampant in gaming at the moment, the fate of the future of gaming is anybody’s guess.

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