Epic Games has announced that it is laying off about 830 employees, which makes up about 16% of its staff, following excess spending by the company and Fortnite’s growth slowing down.
In addition to laying off employees, Epic Games is also divesting its recently purchased online music platform Bandcamp and spinning out SuperAwesome, directly resulting in 250 more employees leaving the company.
CEO Tim Sweeney shared the following message in an email to employees:
“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.”
Sweeney also noted that about two-thirds of the layoffs were outside of core development teams, and the cuts would help the company “get to the other side of profitability.”
The video game industry is reportedly struggling with a slowdown in spending as gamers have become more selective in picking popular titles and become more weary of inflation. Game publishers have also seen more competition, with new entrants like Warner Bros. Discovery getting key releases, such as the 2023 Hogwarts Legacy based on Harry Potter’s Wizarding World franchise.
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