Epic only realized it had ‘financial problem’ that led to layoffs 10 weeks ago

polygon.com:

In typically unguarded comments made on Tuesday at the start of Unreal Fest — a conference for users of its Unreal Engine software — Epic Games CEO Tim Sweeney addressed the financial difficulties that led the company to lay off over 800 staff at the end of September. He mentioned that management only became aware of the seriousness of the situation 10 weeks ago.

Sweeney also announced that Epic would be introducing a new pricing structure for Unreal Engine, making it more expensive to use — but not for game developers. He also restated Epic’s commitment to the Epic Games Store, its crusade against platform “overlords” like Apple and Google, and its mission to “build the metaverse.”

“This wasn’t a right-sizing,” Sweeney said of the layoffs in his speech, which was captured and shared by Fortnite creator Immature (but, oddly, not included in Epic’s official Unreal Fest livestream recordings). “I think we were the right size, and I loved our original plans. This was a survival move that was necessary. And what we did accomplish, the one thing, is that we stabilized our finances so we won’t run out of money as we build the metaverse.”

Tim Sweeney addresses Epic Games Layoffs… <a href=«https://twitter.com/hashtag/UnrealFest?src=hash&ref_src=» https:>#UnrealFest

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Sweeney didn’t specify what the sudden change in Epic’s fortunes had been, or explain why the company hadn’t seen it coming sooner. But he revealed it was “about 10 weeks ago” — so, in late July — “that we realized we were running into a financial problem that we had to solve quickly.” And he made a couple of references to how the company had been funded “heavily” by Fortnite revenue in recent years, a setup that appeared no longer to be