Fortnite maker Epic Games, worth billions, cuts its staff by 16%

polygon.com:

Epic Games, which makes Fortnite and Unreal Engine, is laying off a devastating 16% of its workforce, leaving roughly 830 workers without jobs, Management reportedly emailed staff Thursday to share the news. Bloomberg News first reported the layoffs before Epic Games published its internal memo online.

“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,” CEO Tim Sweeney wrote in an email to staff. “I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic.”

An Epic Games representative pointed Polygon to Sweeney’s memo.

Epic Games employees impacted by the layoffs will get six months of severance and health benefits, Sweeney wrote. The company is also expected to “divest” from two acquisitions: selling recently-unionized music site Bandcamp and “spinning off” most of its marketing company SuperAwesome. Roughly 250 people are leaving Epic Games due to the divestitures.

Epic Games’ estimated worth is valued at $31.5 billion, according to the Wall Street Journal. Fortnite alone generates billions of revenue each year — and is growing again, Sweeney said. This makes the Cary, North Carolina company one of the largest privately-owned video game companies. Chinese tech conglomerate Tencent has owned 40% of the company since 2012, when it paid $330 million for its stake, according to Tencent’s financial reports. CEO Tim Sweeney owns the majority of Epic Games’ remaining shares, Bloomberg said.

“While Fortnite is starting to grow again, the growth is driven primarily by creator content with significant revenue sharing, and this