Annual Report 2025/2026

The Embracer Group’s 2025/2026 fiscal year represents a pivotal transition period defined by aggressive operational restructuring, cost discipline, and a strategic pivot toward high-conviction intellectual property. Facing a challenging market environment, the company reported net sales of SEK 15.9 billion and a significant EBIT loss of SEK 7.1 billion, the latter largely attributable to substantial non-cash impairment charges on goodwill and intangible assets. Despite these financial headwinds, the group maintained an adjusted EBIT of SEK 905 million and successfully executed the spin-off of the Coffee Stain Group, signaling a broader commitment to streamlining its portfolio and enhancing shareholder value.

The company’s long-term strategy centers on a structural transformation into two distinct, publicly listed entities by 2027, including the formation of "Fellowship Entertainment." This move is designed to increase management focus and operational transparency, allowing the group to better steward core franchises such as The Lord of the Rings, Tomb Raider, and Metro. The group has adopted a leaner, decentralized model supported by a robust enterprise risk management framework and a pipeline of 79 active projects. While the PC/Console and Mobile segments experienced sales declines due to divestments and a lack of major new releases, the Entertainment & Services segment demonstrated resilience with organic growth.

Geographically and operationally, the group maintains a global footprint with a diverse, international shareholder base. Governance remains a priority, with the Board of Directors overseeing a transition to European Sustainability Reporting Standards (ESRS) and implementing rigorous internal controls. Although the company has not yet fully formalized all non-financial disclosures, it has integrated double materiality assessments into its risk management to address ESG factors, including workforce well-being and climate change. Moving forward, the group remains focused on disciplined capital allocation and operational cohesion to ensure long-term profitability and stability as it completes its corporate separation.