Embracer Group subsidiary Digic lays off 10% of its workforce
Digic, a Hungarian subsidiary of Embracer Group specializing in 3D and CGI animation and game trailers, has laid off approximately 10% of its workforce, which amounts to around 35 employees. This move follows similar layoffs at another Hungarian Embracer subsidiary, Zen Studios, earlier in the month, where approximately 26% of employees lost their jobs.
According to Digic, these layoffs are part of a "reorganization with a reduction of staff" due to market changes, economic challenges, and the shift to long-term hybrid work arrangements. The company expressed its intention to continue employing some of the affected employees on fixed-term contracts or as freelance subcontractors to increase operational flexibility and the use of freelance experts.
Embracer Group, the parent company, is currently undergoing a restructuring program in the aftermath of the collapse of a $2 billion deal with Savvy Games Group. As part of this program, various projects and studios are being evaluated. The source suggested that Digic is facing challenges because fewer video games require pre-rendered cinematic transitions, as more studios create transition animations in real time within the game engine, reducing the need for external studios for such services.
However, Digic clarified that the reorganization had started before Embracer's restructuring program, and less than 5% of its revenue in 2023 came from Embracer group companies, with these projects unaffected by the parent company's restructuring efforts. The layoffs are seen in the context of the industry returning to a more normal state after the unprecedented "COVID boom," with many companies reassessing their operations and staffing levels.
Source: by Lewis Rees, Staff Writer for PocketGamer.biz