Embracer sales up 190% during Q2, with 35% organic growth

Volition to become part of Gearbox as Saints Row reboot "did not meet full expectations"

News by Marie Dealessandri Deputy Editor

Published on Nov. 17, 2022

Updated on Nov. 18, 2022

Embracer Group has released its financial results for the second quarter of the financial year 2022/2023, with sales booming across the board.

The numbers

Net sales: SEK 9.57 billion ($910 million), up 190% year-on-year (35% organic), including:

PC/console games: SEK 4.1 billion ($390 million), up 107% year-on-year
Mobile games: SEK 1.44 billion ($137 million), up 67% year-on-year

The highlights

Embracer continued to rise during Q2, with its net sales growing 190% year-on-year. The group finalised the acquisition of Crystal Dynamics, Eidos Montreal and Square Enix Montreal during the quarter, so that would have contributed to the growth, but Embracer noted that 35% of the increase was organic.

Among the driving forces behind the sales rise, the company noted good performances across PC and console, "in particular supported by the reboot of Saints Row." However, it said that the title's reception "did not meet the full expectations and left the fanbase partially polarised."

Going forward, its developer, Volition, will be fully integrated to Gearbox "which has all the tools, including an experienced management team in the US, to create future success at Volition," the announcement said.

Earlier this week, Gearbox added a new office as Eidos Shanghai was absorbed and will be known as Gearbox Studio Shanghai going forward.

Still about Gearbox, Embracer announced that it purchased the Risk of Rain IP from Hopoo Games for an undisclosed sum, though the transaction happened after the end of the quarter.

Looking at mobile numbers, Embracer said that performances were impacted by "the looming recession and likely some lingering effects from the changes to IDFA." It added that it was "favourably positioned, with a primarily ad revenue-based model."

A portion of Embracer's financial report was dedicated to adapting to "the challenges of geopolitical and social issues around the world and the new macroeconomic reality," which has lead the company to launch a "special review" of its business to account for new market conditions.

"The outcome of this review may, for example, lead to board recommendations to make spin-off/s (under Lex Asea) into separate publicly listed companies in the future, if that is deemed to be the best for its employees, create higher shareholder value and improve our strategic flexibility," the report read.

Embracer has made a voluntary debt repayment of SEK 6.2 billion ($588 million) during the quarter, the report further said.

The company now has a headcount of 15,731 people (including 10,899 developers), with a total of 237 game development projects.

Outside of video games, Embracer made two acquisitions after the end of the quarter: Plaion acquired Anime Ltd, and Asmodee acquired tabletop distributor VR Group.

In August, Embracer announced the acquisitions of Middle-earth Enterprises, Limited Run and Singtrix via its new division Freemode, while Tripwire Interactive and Tuxedo Labs were acquired via its subsidiary Saber Interactive.