Epic Games Lays Off Hundreds Of Workers And Reshuffles Multiple Divisions

Epic Games s the growing list of companies that are now trying to cut back on their spending as the video game industry sees a post-pandemic decline. The company is now undergoing restructuring with multiple divisions being spun out as separate and completely independent companies. In line with the restructuring, the company also laid off 830 employees, with an additional 250 set to leave as their divisions and departments are dissolved.

“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,” Sweeney itted. “I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic.”

Sweeney explained that layoffs are the only way to ensure the company’s financial sustainability since stopping hiring and cutting back on spending did little to improve their profit margin. Despite Fortnite’s popularity and continued growth, revenue is apparently shared between content creators and the company which makes for lower profits compared to Epic’s other titles.

“We’re cutting costs without breaking development or our core lines of businesses so we can continue to focus on our ambitious plans. About two-thirds of the layoffs were in teams outside of core development,” the CEO added. “Some of our products and initiatives will land on schedule, and some may not ship when planned because they are under-resourced for the time being. We’re ok with the schedule tradeoff if it means holding on to our ability to achieve our goals, get to the other side of profitability and become a leading metaverse company.”

He also assured that there will be no further layoffs and that affected employees will receive six months base pay and six months of free healthcare benefits as well as accelerated stock vesting up until the end of 2024.