Embracer Sees 190% Sales Surge in Q2, Driven by 35% Organic Growth

Embracer Group has unveiled its Q2 financial results for the 2022/2023 fiscal year, marked by substantial sales growth across all segments. - PC and console games generated SEK 4.1 billion ($390 million), representing a 107% year-over-year increase - Mobile games revenue reached SEK 1.44 billion ($137 million), up 67% from the previous year Embracer's net sales soared 190% year-over-year during Q2, with 35% of this growth attributed to organic expansion. The company finalized its acquisition of Crystal Dynamics, Eidos Montreal, and Square Enix Montreal, which contributed to the overall growth. The company cited strong performances in PC and console gaming as key drivers of sales growth, particularly the reboot of Saints Row. However, the game's reception was mixed, failing to meet expectations and polarizing the fan base. As a result, Volition will be fully integrated into Gearbox, which boasts an experienced management team and the necessary tools to drive future success. Earlier this week, Gearbox expanded its presence with the addition of a new office, rebranding Eidos Shanghai as Gearbox Studio Shanghai. Embracer also announced the acquisition of the Risk of Rain IP from Hopoo Games for an undisclosed sum, although the transaction took place after the quarter's end. The company's mobile gaming segment was impacted by the looming recession and changes to IDFA, but Embracer remains favorably positioned due to its ad revenue-based model. A significant portion of Embracer's financial report focused on adapting to global geopolitical and social challenges, as well as the new macroeconomic reality. In response, the company has launched a comprehensive review of its business to address changing market conditions. The outcome of this review may lead to the establishment of separate, publicly listed companies in the future, should this be deemed beneficial for employees, shareholders, and strategic flexibility. Embracer made a voluntary debt repayment of SEK 6.2 billion ($588 million) during the quarter. The company's current headcount stands at 15,731 employees, including 10,899 developers, with a total of 237 game development projects underway. Outside of the gaming sector, Embracer made two acquisitions after the quarter's end: 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, as well as the acquisition of Tripwire Interactive and Tuxedo Labs through its subsidiary Saber Interactive.