How Embracer's layoffs and project cancellations gutted Fishlabs, a promising studio that now lives on as a cross-dev team supporting other Embracer companies
The exclusive inside story of Chorus developers Fishlabs, from Project Black to Project White — A phoenix is a mythological firebird …
Context & Ripple Effects
Fishlabs’ reduction follows Embracer’s broader restructuring path: the group had already signaled studio closures, game cancellations and staff cuts after a major deal fell through, and later reported fewer games in development alongside layoffs affecting roughly 900 employees.
The studio-level account shows how that portfolio rationalization translates into a changed operating role: a team built around its own projects now supports work across other Embracer companies. It adds concrete consequences to the company’s earlier public reckoning with criticism over layoffs and closures.
First-order effects
- Fishlabs loses the ability to pursue the cancelled projects as an independent creative pipeline, while affected staff and teams are absorbed into a smaller cross-development function.
- Embracer retains Fishlabs’ remaining capability, but redirects it from internally led projects toward supporting other companies in its portfolio.
Second-order effects
- Other Embracer studios can draw on Fishlabs’ specialized capacity without building equivalent teams themselves, while the group concentrates project ownership in fewer studios.
- The shift reduces the number of distinct projects progressing through Embracer’s portfolio, extending the contraction reflected in its earlier report of 36 fewer games in development.
Third-order effects
- If repeated across the group, restructuring can turn an acquisition-led collection of studios into a more centralized production network, with support teams prioritized over independently greenlit projects.
- That model may lower the cost of maintaining capabilities, but it also concentrates creative and project-selection risk in the studios that retain ownership of active pipelines.
The trend: Embracer’s Fishlabs restructuring is one instance of post-expansion game publishers consolidating studios, projects and specialist talent around fewer active productions.