Epic Games is laying off more than 800 people: 'We've been spending way more money than we earn'
Fortnite and Unreal Engine maker Epic Games has confirmed that it is laying off approximately 830 employees, representing roughly 16% of Epic's total workforce.
The layoffs were initially reported by Bloomberg, which said employees were informed of the layoffs via an internal memo, followed by an all-hands meeting. Staff being let go will be given six months of severance pay and health insurance, and accelerated stock vesting, meaning they'll take ownership of shares in the company they've earned through their employment more quickly than normal.
The memo sent to employees by Epic CEO Tim Sweeney was later posted on the Epic Games website.
«For a while now, we've been spending way more money than we earn, investing in the next evolution of Epic and growing Fortnite as a metaverse-inspired ecosystem for creators,» Sweeney said. «I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic.
»While Fortnite is starting to grow again, the 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. Success with the creator ecosystem is a great achievement, but it means a major structural change to our economics. Epic folks around the world have been making ongoing efforts to reduce costs, including moving to net zero hiring and cutting operating spend on things like marketing and events. But we still ended up far short of financial sustainability. We concluded that layoffs are the only way, and that doing them now and on this scale will stabilize our finances."
Epic is also spinning off some of its businesses as a
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