Research Summary
The report provides an in-depth analysis of Embark Studios, its games, and the technology it uses. It discusses the studio’s first major project, The Finals, its challenges, and future plans. The report also covers ARC Raiders, another game by Embark, and wim, a creative sandbox platform. Additionally, it examines the success of Balatro, a card game developed by LocalThunk.
Key Takeaways
Embark Studios’ Growth and Investment
- Strong Financial Backing: Embark Studios, founded by former EA and Dice executive Patrick Söderlund, secured a $41M minority investment from Nexon shortly after its inception. This was followed by an additional $96M investment, leading to Nexon acquiring a majority stake. By 2021, Nexon had fully acquired Embark Studios with total investments around $300M.
- Advanced Technology: Embark has developed a proprietary technology stack, including AI for gameplay patterns and accelerated development, photogrammetry for asset creation, and machine learning for NPC behaviors. This technology-first approach is expected to set it apart by enabling faster and more efficient innovation and iteration in gaming.
The Finals: Success and Challenges
- Initial Success: The Finals, a free-to-play FPS, entered open beta in late 2023, achieving 7.5M downloads and becoming the No. 1 wishlisted game on Steam with minimal marketing. However, after its initial success, the player count declined, stabilizing between 20K to 30K concurrent players.
- Challenges and Future Plans: The game’s “Cash Out” mode requires significant team play and communication, disadvantaging solo players. Player retention issues are compounded by a limited number of maps at launch, a problematic matchmaking system, and difficulties in managing cheaters. The developer is responding to feedback on the solo-player experience and is testing a single-player game mode to improve engagement.
ARC Raiders and wim: Potential and Innovation
- ARC Raiders: ARC Raiders, another game by Embark, was initially a third-person co-op PVE shooter but was reworked into a PvPvE extraction shooter after early playtests. The game leverages advanced tools such as proprietary photogrammetry and machine learning for NPC movement.
- wim: Embark’s wim is a creative sandbox platform designed to enable anyone to create and share games. The company is integrating machine learning tools from ARC Raiders into wim to allow creators without game development experience to animate movements.
Balatro: A Successful Card Game
- Profitability and Popularity: Balatro, developed by LocalThunk, achieved profitability within an hour of release and became the fastest-selling game by publisher Playstack, with an estimated 785K players across Steam, Playstation, and Xbox, and a gross revenue estimate of $11.8M.
Actionable Insights
- Monitor Embark Studios’ Progress: Given the strong financial backing and advanced technology, Embark Studios’ progress in the gaming industry should be closely monitored. The success of The Finals and the potential of ARC Raiders and wim could influence other game developers to adopt similar practices.
- Assess the Impact of Player Feedback: The developer’s response to feedback on The Finals’ solo-player experience and the testing of a single-player game mode could significantly impact player retention and engagement. The effectiveness of these changes should be assessed.
- Consider the Potential of Card Games: The success of Balatro suggests a strong market for card games. The potential for growth in this genre, particularly games that offer a unique blend of familiar and fresh elements, should be considered.
