Embracer's New CEO Says Trust Is Improving After $2B Collapse

Key Takeaways

• Embracer has dropped from 17,000 employees to roughly 5,687 since June 2023
• The company has undergone three separate corporate restructurings since April 2024
• CEO Phil Rogers calls the experience 'very humbling' but insists trust is rebuilding

Phil Rogers has a trust problem. As CEO of Embracer Group, he inherited a company that spent years buying studios it couldn't afford, then spent the next three years firing thousands of people and closing dozens of those same studios. Now, in a new interview with The Game Business, Rogers says he believes trust in the company is finally improving.

"It's been a very humbling experience," Rogers said. "There's a lot of reflection on that in terms of how the industry changed and could we have not all predicted this?"

The short answer to his rhetorical question: yes, many people could have predicted this. And many did.

The Numbers Tell the Story

Embracer's current headcount sits at an estimated 5,687 employees. In June 2023, that number was around 17,000. The company has closed or divested more than 44 studios since its restructuring began. One canceled project alone, the Eidos-Montréal game Wildlands, reportedly had a development budget exceeding $100 million.

The layoffs haven't stopped. In March 2026, Embracer cut 124 jobs at Eidos-Montréal. That was the fourth round of layoffs at that single studio since January 2024. In October 2025, the company sold off Arc Games and Cryptic Studios entirely.

Three Restructurings in Two Years

Embracer hasn't just been cutting staff. It has been splitting itself apart.

That most recent split in April 2026 produced one of the better headlines in recent gaming journalism memory, describing Embracer's corporate strategy as "binary fission."

How Did It Get This Bad?

Between 2019 and 2022, Embracer went on an acquisition spree that would make a private equity firm blush. The company bought studios at a furious pace, building a portfolio of beloved developers and iconic IP. The problem: Embracer was counting on a $2 billion investment deal to fund it all.

That deal collapsed in 2023. Without the cash infusion, Embracer couldn't sustain the empire it had built. The result was what industry analysts called a "slash-and-burn" restructuring. Over 80 projects were canceled. Studios that had been pillars of their local game development communities were shuttered.

“The restructuring was a 'slash-and-burn' era that saw the cancellation of over 80 projects and left a trail of shuttered studios that were once pillars of their communities.”

— Industry Analyst Report

Rogers wasn't CEO when the deal collapsed. He was Embracer's interim chief strategy officer. But he was already defending the company's approach. At the time, he described the restructuring as "how we win." That phrase did not win him many fans in an industry watching colleagues lose their jobs by the thousands.

The Leadership Musical Chairs

Rogers ascended to CEO in 2025, but calling it a change in power would be generous. Lars Wingefors, the architect of both Embracer's rise and its spectacular fall, didn't leave the company. He became executive chair, a position from which he will focus on "mergers and acquisitions and capital allocation."

Yes, the person who led Embracer's acquisition binge will now focus on future acquisitions. The industry's reaction has been predictably skeptical.

Was This Predictable?

Rogers frames the collapse as an industry-wide failure to predict changing conditions. He references how the COVID-19 pandemic drove extraordinary demand for games, then how that demand faded as people started going outside again.

This is true, but incomplete. The pandemic gaming boom was always going to end. People were going to leave their homes again. That part was obvious in real time, not just hindsight. The executives who get paid millions of dollars per year are supposed to know this. That's the entire point of paying them millions of dollars.

Embracer isn't alone in overestimating post-pandemic demand. Microsoft, Sony, EA, and others have all conducted layoffs. But the scale of Embracer's miscalculation stands out. Building an empire on a $2 billion deal that hadn't closed is a specific kind of risk that specific people chose to take.

Community Trust Remains Low

Rogers says trust is improving. Community forums suggest otherwise. Reddit discussions and gaming communities remain skeptical of management's claims, pointing to the loss of iconic development teams and canceled projects as evidence that Embracer's culture was permanently damaged by the pursuit of rapid, unsustainable growth.

“We have a clear path to capture full potential in the new entities, but we acknowledge the impact these changes have had on our people and the industry trust.”

— Phil Rogers, CEO of Embracer Group

Acknowledging impact is not the same as restoring trust. The developers who lost their jobs can't be un-fired. The canceled games can't be un-canceled. The communities built around studios that no longer exist don't reform because a CEO gives an interview.

What Happens Now

Embracer's strategy now appears to be fragmentation. By splitting into separate publicly traded companies, the theory goes, each entity can focus on its core strengths without the baggage of the parent company's reputation.

Whether this works depends on factors beyond corporate structure. Can these new entities ship good games? Can they retain talent? Can they convince partners and investors that the people running things today are different from the people who made the decisions that led to this point?

The last question is tricky when Lars Wingefors is still the executive chair.

Frequently Asked Questions

Why did Embracer Group collapse?

A $2 billion investment deal fell through in 2023, leaving Embracer unable to fund the dozens of studios it had acquired between 2019 and 2022. The company was forced into a brutal restructuring that included mass layoffs and studio closures.

How many employees did Embracer lay off?

Embracer's headcount dropped from approximately 17,000 in June 2023 to an estimated 5,687 currently. The company also closed or divested more than 44 studios.

Who is Phil Rogers?

Phil Rogers became Embracer's CEO in 2025 after serving as interim chief strategy officer. He previously defended the company's restructuring as 'how we win,' a statement that drew criticism from industry observers.

What is Fellowship Entertainment?

Fellowship Entertainment is one of the companies that emerged from Embracer's corporate splits. It was previously called Middle-Earth Enterprises & Friends and became its own publicly listed company in April 2026.

Is Embracer still laying off employees?

Yes. As recently as March 2026, Embracer laid off 124 people at Eidos-Montréal. That was the fourth round of layoffs at that studio since January 2024.

Source: PCGamer latest