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General1 year ago

Fortnite creator Epic Games fires staff due to 'unrealistic' spending

Image: Epic Games

Epic Games CEO Tim Sweeney says the company has been “spending way more money than we earn.”

Fortnite maker Epic Games has announced that it is laying off 16% of its staff. CEO Tim Sweeney released a statement to confirm that the layoffs would impact roughly 830 employees in total, as well as a few studios the company has under its corporate umbrella. For example, the company plans to sell off Bandcamp and spin-off ‘most of’ SuperAwesome.

In the statement, Sweeney states:

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

The CEO shares that Fortnite is, “starting to grow again,” which carries the surprising implication that it ever stopped growing at all. However, that growth is mostly driven by content creators and the game’s revenue sharing system, calling for, “a major structural change to our economics.” Sweeney goes on to say that a variety of efforts were made to reduce costs by ‘Epic folks around the world’ but, like most companies of its size, firing people seemed to be the best way forward. 

While Sweeney does not apologise for laying off hundreds of employees at a time, he does conclude that the layoffs will be, “a terrible experience for all.” At the very least, the company is supporting its laid off employees with a hefty severance package including six months of pay and in the US/Canada Brazil, six months of healthcare. The company is also looking into helping employees transition into different careers and accelerating their stock option vesting schedule. 

Sweeney goes on to be optimistic about Epic’s future despite the layoffs, saying that the company is, “cutting costs without breaking development or our core lines of businesses so we can continue to focus on our ambitious plans.” The focus is still on Unreal Engine 5 and Fortnite Battle Royale, with the two often merging for user-created content. What is unfortunate is that some 800 employees will only be able to watch from the sidelines as these plans take off, while their ex-CEO doesn’t take so much as a pay cut in solidarity. 

Quite a few companies have been making cuts in the games industry this year. Activision Blizzard recently laid off staff in its esports divisions before shuttering the Overwatch League. Games are getting bigger and more expensive to produce, but the teams making them keep getting smaller with time. 

Author
Timothy "Timaugustin" AugustinTim loves movies, TV shows and videogames almost too much. Almost!

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