Embracer Group Announces 2025 Split Into Three Companies

In April 2024, Swedish gaming conglomerate Embracer Group announced a sweeping reorganization plan that would see it split into three separate publishing entities by 2025, marking one of the most dramatic shakeups in the video game industry’s recent history. This strategic pivot follows a turbulent period for the company, which included a failed $2 billion investment deal in 2023 and a series of aggressive cost-cutting measures. In the months leading up to the announcement, Embracer closed or divested over 44 studios, including prominent names like Volition and Free Radical Design, cancelled more than 80 game projects, and laid off nearly 8,000 employees across its global operations. Under the new structure, Embracer will be reorganized into three standalone publicly listed entities: Asmodee Group (board and card games), Coffee Stain & Friends (indie and AA titles with strong live-service models), and Middle-earth Enterprises & Friends, which will remain under the Embracer name and focus on high-profile AAA franchises such as Tomb Raider, Metro, and The Lord of the Rings. This move is designed to untangle Embracer’s sprawling corporate web and unlock value by allowing each arm to pursue tailored business strategies. With the games industry facing increased financial scrutiny and shifting market demands, Embracer's transformation is seen as both a survival strategy and a recalibration of its once-ambitious expansion.