Epic Games recently underwent a massive layoff. Affecting over 800 employees, Epic games stated that the layoffs took up around 16% of their staffing. A portion of MediaTonic, creators of Fall Guys, fell victim to layoffs as well. Due to the increased competitiveness of cloud-based gaming, Epic Games began to focus more on UEFN (Unreal Editor For Fortnite). Unreal Engine allowed players to utilize the sandbox tool and produce a variety of games for the community. As they experienced a shift in structural change, the company publicly released a memo to their employees.
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…
-Tim Sweeney, CEO of Epic Games
Following a decline in in-app purchases from Fortnite‘s Battle Royale, the company has begun to switch toward investing in its cloud-based gaming. Fortnite‘s Battle Royale had reached its peak and a majority of Fortnite’s growth was now driven in from its creator content. The growing revenue share and lower business marginal produced by UEFN was viewed as a “[successful] achievement” by the Epic Games company.
The evolution of Epic, unfortunately, came with repercussions. Despite efforts to reduce costs, they had resorted to their final solution. The company had concluded that to stabilize financials, layoffs were to be made. Sweeney claims that the company wanted to send off their employees with the best intentions. With sufficient funds, they were able to provide their terminated employees with a 6-month severance package. The statement revealed that there would be no more layoffs after and that the cuts made were means to maintain sustainability through the economic change.
Official Email from Tim Sweeney to Epic Games employees regarding the 16% (~900) layoffs. (Obtained by @InsiderGamingIG)
"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… pic.twitter.com/ELFbPuQaCj
— HYPEX (@HYPEX) September 28, 2023
We wish the best to those affected by the lay offs and hope new opportunities quickly fall their way.
Source: Epic Games Public Statement
