After eating up lots of game studios Embracer Group set to close a bunch

Sounds like one of those situations where the workers get screwed while the suits float safely to the ground on golden parachutes.

Quoting: denyasis

Quoting: Purple Library GuyFrankly, this kind of sounds like their buyouts were leveraged from the start

Well yeah, that's how, was far as I know, almost every industry works... On credit.

When I worked in construction, our company owner would joke "The entire industry would freeze if any one actually tried to collect their bills!!"

Even small business do the same. A deli owner friend of mine remarked how he didn't turn a profit for his first 5 years and how that was the average for his industry/region. That's 5 years with everything on credit and even if he did make some profit, the debt is still there.

I'm some cases, paying off debts is considered a waste of money as you get higher yields investing that money vs the savings from paying early (or at all), especially in during our past decade where interest rates were low.

Of course, that can bite people and companies when expected investments fall apart, as it seems to have done here.

Lovely capitalism.

Quoting: Purple Library GuyIf other people start restaurants and use debt to help finance their operations, and then I take out debt to buy some of those restaurants (along with the debt the restaurants already had), that means I'm stacking new debt on top of the old debt, but not adding any new productive activity.

I think there's a third variant: Companies aiming for world domination, that are not even trying to make profits. Uber is (was?) expanding and expanding while making billions of loss. The restaurant boss in contrast wants to make profit from the beginning, it's just not something that happens from day one. And they probably wouldn't open another restaurant before the first one works well.

Quoting: F.Ultra

Quoting: BalkanSpy"transform us from our current heavy-investment-mode to a highly cash-flow generative business this year"

Gotta love that corporate doublespeak. Which new gibberish will they invent next?

Not so sure exactly what it is here that you think sounds doublespeak? This just means that they have halted their expansion and will now concentrate on generating income instead.

They could have thought that the lack of funding, or not getting a deal, could happen and start being a highly cash-flow before that to prevent this. They could also give the middle finger to investors and say they won't be returning their money any time soon, and keep the studios and their workers. The high execs could also freeze their super high salaries for an X amount of time to palliate the problem.

But no, they directly prefer cutting costs to the expense of workers.

To me, the doublespeak is undermining the effect of these cuts on those affected, like if it was the most normal thing in the world, and the fact that they lost $2bn investment, by trying to positively say that it will allow them to be highly cash-flow generative.

Quoting: Arehandoro

Quoting: denyasis

Quoting: Purple Library GuyFrankly, this kind of sounds like their buyouts were leveraged from the start

Well yeah, that's how, was far as I know, almost every industry works... On credit.

When I worked in construction, our company owner would joke "The entire industry would freeze if any one actually tried to collect their bills!!"

Even small business do the same. A deli owner friend of mine remarked how he didn't turn a profit for his first 5 years and how that was the average for his industry/region. That's 5 years with everything on credit and even if he did make some profit, the debt is still there.

I'm some cases, paying off debts is considered a waste of money as you get higher yields investing that money vs the savings from paying early (or at all), especially in during our past decade where interest rates were low.

Of course, that can bite people and companies when expected investments fall apart, as it seems to have done here.

Lovely capitalism.

People being irresponsible with finances (and, yes, taking out huge loans that you can't easily repay is irresponsible) is not a feature of capitalism.

Quoting: Mountain Man

Quoting: Arehandoro

Quoting: denyasis

Quoting: Purple Library GuyFrankly, this kind of sounds like their buyouts were leveraged from the start

Well yeah, that's how, was far as I know, almost every industry works... On credit.

When I worked in construction, our company owner would joke "The entire industry would freeze if any one actually tried to collect their bills!!"

Even small business do the same. A deli owner friend of mine remarked how he didn't turn a profit for his first 5 years and how that was the average for his industry/region. That's 5 years with everything on credit and even if he did make some profit, the debt is still there.

I'm some cases, paying off debts is considered a waste of money as you get higher yields investing that money vs the savings from paying early (or at all), especially in during our past decade where interest rates were low.

Of course, that can bite people and companies when expected investments fall apart, as it seems to have done here.

Lovely capitalism.

People being irresponsible with finances (and, yes, taking out huge loans that you can't easily repay is irresponsible) is not a feature of capitalism.

Depends what you mean. In the sense that it's a bug rather than a feature, sure. Or, in the sense that it's not "intended", OK.
In the sense that a "feature of X" is something that inevitably goes with it . . . yeah, it's a feature of capitalism.

Quoting: Arehandoro

Quoting: F.Ultra

Quoting: BalkanSpy"transform us from our current heavy-investment-mode to a highly cash-flow generative business this year"

Gotta love that corporate doublespeak. Which new gibberish will they invent next?

Not so sure exactly what it is here that you think sounds doublespeak? This just means that they have halted their expansion and will now concentrate on generating income instead.

They could have thought that the lack of funding, or not getting a deal, could happen and start being a highly cash-flow before that to prevent this. They could also give the middle finger to investors and say they won't be returning their money any time soon, and keep the studios and their workers. The high execs could also freeze their super high salaries for an X amount of time to palliate the problem.

But no, they directly prefer cutting costs to the expense of workers.

To me, the doublespeak is undermining the effect of these cuts on those affected, like if it was the most normal thing in the world, and the fact that they lost $2bn investment, by trying to positively say that it will allow them to be highly cash-flow generative.

There is no way that a public company can give the finger to investors. Remember that the investors, aka the share holders, are the actual owners of the company, the CEO and other execs are only running the company per the will of the shareholders.

Still don't get how any of that turns the quote into doublespeak. It's quite clear what they mean and it also exactly describes the situation and what they are going to do.

From the article It’s a myth that companies must put shareholders first:

The notion that a corporation’s primary purpose is to look after its shareholders is widely believed and taught, but is in fact a myth with no basis in corporate law. The corporation is a separate legal entity. Because ownership of assets and liabilities are attributed to this entity, corporations are not “owned” by shareholders.

Instead, shareholders have limited legal rights, which do not include the right to directly control directors’ or managers’ behaviour. Indeed, shareholders have no special claim on a corporation’s economic returns. Their right to dividends is the same as a waiter’s right to tips: an expectation that is unlikely to be enforceable in court.

Quoting: F.UltraThere is no way that a public company can give the finger to investors. Remember that the investors, aka the share holders, are the actual owners of the company, the CEO and other execs are only running the company per the will of the shareholders

So, not quite true. Companies decide to allign with them.

Quoting: Mountain ManPeople being irresponsible with finances (and, yes, taking out huge loans that you can't easily repay is irresponsible) is not a feature of capitalism.

Capitalism thrives off irresponsible people. It's no a coincidence that day to day finances are not taught in school from very early age.

Someone's mysery is another's profit. Yeah, it is a feature.

Hopefully Limited Run Games doesn't get flushed. lol