For the past few years, Swedish holding company Embracer Group has seemed to do nothing but buy up game studios, but this time something went wrong. At the crucial moment, a particularly large deal failed. So big that it even crashed the company’s stock.
Image Source: Steam (PcExtreme)
According to Embracer CEO Lars Wingefors, the holding company has existed since October 2022 worked with a potential partner about an agreement that might come about “a new benchmark for the gaming industry”.
The deal was valued at $2 billion. In October 2022, Embracer already had a verbal agreement with a counterparty. Negotiations dragged on much longer than initially expected, but nothing indicated difficulties.
“As of yesterday, the entire documentation is ready. We requested execution of the agreement prior to the release of our fourth quarter results, but last night the counterparty received a refusal.”Wingefors explained.
In addition to the failure of a major order, several key releases were delayed due to forecast adjustments (Image source: Deep Silver)
This plot twist came as a surprise to Embracer’s board of directors and has already impacted the value of the holding’s shares. Her prize for the last day reduced more than 40% compared to yesterday’s numbers.
Embracer itself also had to adjust its profit forecast for the current financial year (ending in March 2024). The holding planned a profit of 964 to 1.27 billion US dollars and has now agreed on an amount of 655 to 843 million US dollars.
As for the latest results, Embracer’s revenue grew 121% year over year to $3.55 billion. Dead Island 2, meanwhile, sold over 2 million copies, beating management’s expectations, and Metro Exodus hit the 8.5 million mark.
Add Comment