Epic Games Fires 870 Because of Fortnite's Lower Profits

That's around 16% of the company's entire workforce.

Unreal Engine and Fortnite developer Epic Games has reportedly been hit by a massive wave of layoffs, resulting in the departure of 870 of its employees, equivalent to approximately 16% of the company's entire workforce.

This restructuring was communicated to the staff during an all-hands meeting, and it appears to be driven by the diminishing profits of Fortnite. Tim Sweeney, the CEO of Epic Games, revealed that the company has been operating at a financial deficit for an extended period, prompting the need for these layoffs.

"For a while now, we've been spending way more money than we earn," Sweeney wrote in a memo to employees (via Bloomberg). "I had long been optimistic that we could power through this transition without layoffs, but in retrospect, I see this was unrealistic."

"[Fortnite's] growth is driven primarily by creator content with significant revenue sharing, and this is a lower margin business than we had when Fortnite Battle Royale took off and began funding our expansion," he added. "Success with the creator ecosystem is a great achievement, but it means a major structural change to our economics."

Sweeney also mentioned that an extra 250 individuals will be departing from Epic Games through the sale of the music platform Bandcamp, which Epic acquired last year, and the separation of the marketing firm SuperAwesome, which became part of Epic in 2020.

"We're cutting costs without breaking development on our core business so we can continue to focus on our ambitious plans," stated Sweeney

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Comments 2

  • Anonymous user

    "diminishing profits of Fortnite" LOL. They make over $1 million DAILY of Fortnite and now they make less than million daily. Unbelievable they're so thirsty they had to fire people. Just do a better game, stop introducing and reintroducing bugs with evey patch and people will continue to play.

    1

    Anonymous user

    ·4 months ago·
  • Anonymous user

    I’d invite you to do the math on daily costs in addition to daily revenue, it might make more sense to you then. I’ll wait.

    0

    Anonymous user

    ·4 months ago·

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