Thunderful is restructuring its publishing business and laying off between 80 to 100 employees.
This is the second restructuring program Thunderful has enacted in 2024, with the company previously committing to laying off 20 percent of its workforce in January to offset “over-investments made in the last few years.”
Thunderful said its latest program will reduce investments in internal game projects to increase focus on third-party publishing.
“The program will lead to workforce reductions and the discontinuation of some internal game projects. In short, the program will mean,” explained the Steamworld publisher in an investor announcement.
Thunderful expects the impending layoffs to deliver annual cost savings of between 80 million SEK ($5.7 million) and 90 million SEK ($6.4 million). It explained that cutting jobs will incur a one-time cost of 25 million to 30 million SEK during Q4, and noted it will be negotiating with relevant labor unions.
“Thunderful’s management and Board of Directors have continued to assess the Group’s business capabilities and capital structure, and after careful consideration, have decided to implement this strategic restructuring program in the Publishing segment. The shift will entail a greater focus on third-party game publishing and a reduction in investments in internally developed projects,” continues the announcement.
Thunderful’s “cost-saving measures”
“This newly announced program follows the cost-saving measures introduced earlier this year, as well as the divestment of the Group’s distribution business to manage previously incurred net debt. Whilst significant reductions in cost levels were achieved this year, revenue targets have not been met and the Group is still struggling with negative cash flow.”
Thunderful claimed that shifting focus to external publishing will reduce fixed costs and provide greater flexibility, enabling faster more diverse game releases that leverage external talent and resources. The company emphasized it will retain “some internal development capacity” and said the restructuring program will be implemented immediately.
“It is regrettable to announce a second restructuring of Thunderful in less than a year, but we unfortunately see no other alternatives in order to ensure the Group’s long-term sustainability and resilience,” said company CEO Martin Walfisz.
“The strategic move towards publishing games from external partners allows us to reduce fixed costs, increase flexibility, and better control our cash flow. We have many talented and dedicated employees, and it is with great regret that we are forced to part ways.”
The restructuring program won’t impact Thunderful’s Co-development and Services segment. It will, however, result in a write-down of goodwill and investments in game rights amounting to 220 million to 240 million SEK.