Fortnite Maker Epic Games Laying Off 870 Employees

ign.com:

Epic Games, the North Carolina-based studio behind Fortnite and Unreal Engine, has suffered a significant round of layoffs.

First reported by Bloomberg, Epic Games is laying off 870 employees, or about 16 percent of its workforce. The layoffs were announced via a memo to staff, Bloomberg wrote. Epic Games shared the memo CEO Tim Sweeney sent out to staff in a new blog post.

The memo reveals that Mediatonic, the developer behind Fall Guys, which Epic Games acquired in is "divesting" music service platform Bandcamp and would spin off most of SuperAwesome, a kid-safe technology company. Both were acquired by Epic Games in 2022 and 2020, respectively.

You can read the full memo below.

Hi everyone,

As we shared earlier, we are laying off around 16% of Epic employees. We're divesting Bandcamp and spinning off most of SuperAwesome.

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. 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