Epic Games will lay off 1,000 employees on Tuesday, according to a company memo posted on Epic blog.
“The drop in Fortnite engagement starting in 2025 means we are spending far more than we earn and have to make significant cuts to keep the company funded,” Epic Games CEO Tim Sweeney wrote in the memo. “This layoff, along with more than $500 million in cost savings identified in hiring, marketing and closing some vacant positions, puts us in a more stable position.”
Last week, Epic also increased the price of V-Bucks, the in-game currency Fortnite, saying that “the cost of running Fortnite has increased a lot.”
Sweeney said the layoffs were not because AI made developers’ jobs redundant. Indirectly, however, the company may be facing AI-related headwinds as RAM shortages and chip demand have had knock-on effects across the industry and also impacted consumer spending.
Laid-off employees will receive four months of severance pay, and more for people with longer tenure. Epic will continue to pay for U.S. employees’ healthcare for six months after the layoff.
