Embracer Offloads Arc Games and Cryptic Studios

In a move to further streamline its operations, Embracer has sold off two more studios from its extensive portfolio. Arc Games and Cryptic Studios have been acquired by Project Golden Arc, a new entity led by members of Arc Games' management team and backed by Hong Kong-based XD Inc. Arc Games is known for publishing live-service games such as Star Trek Online, Neverwinter, and the Remnant series, as well as Torchlight and Hyper Light Breaker. Cryptic Studios, on the other hand, developed Neverwinter and Star Trek Online. The sale generated $30 million (SEK 287 million) in proceeds for Embracer. As part of the agreement, Embracer retains publishing rights to the Remnant franchise, developed by Gunfire Games, and rights to the MMO Fellowship, developed by Chief Rebel and currently in Early Access. The latter will be assigned to Coffee Stain, which is set to be spun out of Embracer in December. According to Phil Rogers, CEO of Embracer, 'This transaction aligns with our key priorities by bolstering our focus on strategic assets and core IPs within Embracer, while enhancing profitability and free cash flow.' The deal also allows the online multiplayer game Fellowship, developed by a talented external team in Stockholm, to find a new home within Coffee Stain Group. Rogers expressed gratitude to the teams at Arc and Cryptic for their hard work over the past four years and wished them success in their future endeavors. The studios were previously owned by Perfect World, which Embracer acquired in 2021 and rebranded as Gearbox Publishing San Francisco. Embracer sold off Gearbox in 2024. This divestment marks the latest step in Embracer's efforts to unwind its rapid expansion under founder and former CEO Lars Wingefors, which was halted after a planned $2 billion partnership did not materialize. The company reported a net loss of SEK -23 million for the most recent quarter and a total income of SEK -203 million for the period.