Embracer Group stock drops after negative Saints Row reviews

Negative reviews of the new Saints Row video game are hitting at an awkward time for Swedish gaming giant Embracer Group, as it tries to prove itself a powerful player in the industry.

Driving the news: Critical drubbings of the game commenced at 10am ET today. The stock price for Embracer Group AB dove right after.

• It’s down more than 7% for the day.

Critics have called the game “terrible,” “generic” and “more like a repetitive retread than a proper reboot.” (To be fair, another called it “worthy of your time.”)

• This new Saints Row, from longtime studio Volition, was meant to revive the long-running, open-world interactive crime franchise of the same name. The series began as an off-brand Grand Theft Auto and had morphed into something more outrageous and comedic.
• The new game, more serious than its recent predecessors, is also the first big-budget, or AAA release from the Embracer family of companies since the Swedish holding company began turning heads with its studio shopping sprees.
• This Saints Row is one of two AAA games Embracer management touted last week to investors, the other being an early 2023 title that is widely expected to be Dead Island 2.

Between the lines: Embracer has bought dozens of game studios in recent years and has a chart on page 24 of its Aug. 18 interim report to prove that most of the projects from those teams have had a solid return on investment.

• But those games tended to be smaller-scale efforts in which the risks are relatively low and the upside of a breakout hit is considerable.
• The expenses of AAA game development are what leads mega-publishers like Square Enix to lament the relative underperformance of multimillion-selling Tomb Raider games and sell the studios making them (the soon-to-be-owner of Tomb Raider and its dev studios? Embracer).

The big picture: Bad reviews don’t necessarily result in bad sales, but they seldom help.

• Embracer has enough studios working on enough projects that, even if Saints Row proves to be an all-around dud, it has plenty of other opportunities to post a critical and commercial success.
• It's also signaled its awareness of the importance of game quality, recently shifting one major title from one of its internal studios to another.

I played Saints Row too and did not have a very good time.

• I gave it four hours, during which it crashed at least three times.
• The run-drive-shoot gameplay felt generic, the story of plucky young adults forming a gang against cartoonish gangsters and cops an eye-roll.
• My favorite bit: the game’s marvelous character creator, which can be toyed with for free.

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