Report: Fortnite and Unreal Engine developer Epic Games is laying off hundreds of employees

What you need to know

• Epic Games is the developer and publisher of Fortnite, as well as the team responsible for developing and maintaining Unreal Engine. 
• According to Bloomberg, Epic Games is laying off 870 employees, or around 16% of its total workforce. 
• Epic Games is also reportedly divesting two prior acquisitions, selling music website Bandcamp and spinning off marketing company SuperAwesome.

The story of layoffs in 2023 across the video game industry continues. 

According to a report from Bloomberg, Epic Games is laying off 870 employees, which is about 16% of the total company workforce. Epic Games is well-known as the developer of massively popular free-to-play title Fortnite, as well as being the developer behind Unreal Engine, with the latest iteration, Unreal Engine 5, fully launching back in April 2022.

Any employees affected by the layoffs are reportedly receiving six months of severance pay and healthcare, in addition to faster stock vesting.

Epic Games is also reportedly divesting two acquisitions, with music website Bandcamp being sold to Songtradr, while marketing company SuperAwesome will be spun out independently.

In an email to employees, Epic Games CEO Tim Sweeney said that “For a while now, we’ve been spending way more money than we earn,” and that the Fortnite Creator program does not have the same margins as Fortnite. According to Sweeney, no more layoffs are planned at the company.

This comes as 2023 has been struck with layoffs and studio closures all around the gaming industry. The last few weeks alone have seen Embracer Group-owned Volition being closed, while Immortals of Aveum developer Ascendant Studios and Total War developer Creative Assembly have been hit with layoffs. 

Analysis: 2023 needs to stop

I’m really, really sick of writing about layoffs. It’s hard to watch companies make money and lay off the people who make that money possible. It’ll be interesting to see what happens in the coming months, and I hope more developers pay attention to the unionization efforts that have begun in earnest over the last several months. 

As for Epic Games, it still feels weird that these layoffs are happening no extra context as to what’s going on at the company. Maybe more light will be shed as time goes on.