CEO of Controversial Gaming Company Urges Players to Trust Embracer Group

After some significant changes at the top, Embracer CEO Phil Rogers is optimistic that both players and developers will begin to regain their trust in the company, hinting at potential future acquisitions.

Embracer, known for franchises like Saints Row, Tomb Raider, and Dead Island, as well as the rights to create games set in Tolkien’s Middle-earth, has faced a rough patch lately. Following a decade of aggressive acquisitions, including the revival of THQ, the company hit a wall when a $2 billion development deal fell through, leading to a partial collapse.

In a recent interview, Rogers, who stepped in during the tail end of the company’s notorious spending spree from 2020 to 2023, described the past few years as a “humbling experience.”

Since the fallout from that major deal, Embracer has been busy restructuring, selling off parts of its business, and laying off a significant number of employees. Most of its game studios and publishers are now under the umbrella of Fellowship Entertainment, alongside Embracer’s ownership of the Middle-earth and Lord of the Rings IP, acquired in 2022.

“There’s a lot of reflection on how the industry has changed and whether we could have predicted this,” Rogers noted. “We know we’re on a journey. Internally, it’s about being more transparent with our employees, which we’ve been working on. It’s crucial for everyone to understand the industry landscape, how it affects us, what we’re doing, and what we might want to adjust.”

As Embracer stabilizes and grants its studios more autonomy while ensuring they have the necessary resources and access to various IPs—like allowing Warhorse, the studio behind Kingdom Come: Deliverance, to develop a Lord of the Rings RPG—Rogers appears hopeful that the company’s reputation is on the mend.

“I’d like to think trust is improving,” he said. “If you were to ask 100 people what they think of Embracer, I want that score to be better in one, two, or five years. Many companies in this industry have faced challenges, re-evaluated their strategies, and come back stronger. We’re definitely in that category.”

Interestingly, Rogers also indicated that Embracer remains open to future acquisitions and mergers, albeit with a more cautious approach informed by past experiences.

“Funding for any acquisition would come from organic cash flows, which is important to highlight. The Embracer segment has several businesses that are performing well, some of which are quite specialized. If M&A can help those businesses grow, it’s definitely on the table,” he explained.

“If you’re generating profits, you’re generating cash. That opens up opportunities for considering M&A as a viable option.”

It’s reminiscent of Lucy holding the football for Charlie Brown, promising she won’t pull it away this time. As I listen to the CEO of Embracer suggest future acquisitions while claiming they’ve learned from their past, that image certainly comes to mind.