Epic Games CEO Tim Sweeney announced layoffs of more than 1,000 employees - roughly 20-25% of the company’s workforce - citing declining Fortnite engagement that left the company spending significantly more than it earns.
Sweeney said the cuts, combined with over $500 million in identified cost savings, are necessary to stabilize Epic’s finances. He was explicit that the layoffs are not AI-related, pointing instead to a broader set of pressures: slower industry growth, weaker consumer spending, higher operating costs, declining console sales, and ongoing legal battles with Apple and Google.
Affected US employees will receive at least four months of base pay as severance, six months of paid healthcare, and accelerated stock vesting.
This is the second significant round of cuts in under two years. In September 2023, Epic laid off around 830 employees, about 16% of its staff at the time.
Going forward, Epic says it plans to focus on Fortnite seasonal content and push development of Unreal Engine 6. The company also recently raised prices on Fortnite’s in-game currency.

Collections

Epic Games CEO Tim Sweeney announced layoffs of over 1,000 employees (20-25% of the workforce), citing declining Fortnite revenue and unsustainable spending. The cuts, alongside $500M+ in identified cost savings, aim to stabilize finances. Contributing factors include slower industry growth, weaker consumer spending, higher operating costs, declining console sales, and ongoing legal battles with Apple and Google. Affected US employees receive four months severance pay, six months healthcare, and accelerated stock vesting. This follows a 2023 round of ~830 layoffs. Epic plans to focus on Fortnite seasonal content and accelerate Unreal Engine 6 development, and has recently raised prices on in-game currency.

Epic Games lays off over 1,000 employees as Fortnite revenue falls short