Epic Games Laying Off 16% of Their Workforce
A bit of shocker is coming out of North Carolina today as Epic Games is laying off 830 employees, around 16% of their workforce.
Epic Games is the well-known developer of the free-to-play title Fortnite and the developer behind the Unreal Engine, with its latest iteration, Unreal Engine 5, launching in April 2022. Bloomberg News initially reported the layoffs before Epic Games published its internal memo online.
Epic Games is Laying Off Hundreds of Employees
CEO Tim Sweeney said in the memo, “For a while now, we’ve been spending way more money than we earn. I had long been optimistic that we could power through this transition without layoffs, but in retrospect, I see this was unrealistic.”
A total of 870 employees will be affected by the layoffs, and Sweeny has stated that no more job cuts are planned beyond this. Two-thirds of the cuts come from teams that are outside of Epic’s ‘core development.’
Epic Games employees impacted by the cuts will get six months of severance and health benefits, Sweeney wrote. Epic Games is also expected to ‘divest’ from two acquisitions, by selling music site Bandcamp and ‘spinning off’ Supercompany. Around 250 people are leaving the studio due to divestitures.
According to the Wall Street Journal, Epic Games is currently valued at $31.5 Billion. Fortnite alone makes Epic Games billions of dollars every year, and it’s growing again, Sweeney said.
“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,” Sweeney stated.
One of the staff members who was hard hit by the layoffs was Ed Fear, director, and writer at Mediatoinic, who has previously worked on titles such as Murder by Numbers.
Epic Games’ mass layoff comes right after Sega canceled Hyenas, with job cuts coming at developer Creative Assembly. Sega has already confirmed that European Subsidiaries would see the impacts of the cut as well. We’re also seeing other studios, such as Ascendant Studios, laying off half of its staff.
Even though 2023 has proven to be an amazing year for video game releases, the same can’t be said for the developers behind these as they continue facing job insecurity and challenging working conditions.