Layoffs have hit Fortnite developer Epic Games again. Today CEO Tim Sweeney announced that the company is cutting more than 1,000 jobs, citing a downturn in engagement for Fortnite dating back to last year. “This layoff, together with over $500 million of identified cost savings in contracting, marketing, and closing some open roles puts us in a more stable place,” he wrote.
The layoffs follow a reduction of more than 800 roles in 2023. Sweeney’s note listed a number of industry-wide issues that have plagued the live-service games space over the last several years, including increased competition and reduced consumer spending. But he also admitted that some of Epic’s issues are specific to Fortnite.
“Despite Fortnite remaining one of the most successful games in the world, we’ve had challenges delivering consistent Fortnite magic with every season; we’re only in the early stages of returning to mobile and optimizing Fortnite for the world’s billions of smartphones; and in being the industry’s vanguard we have taken a lot of bullets in a battle which is only in the early days of paying off for ourselves and all developers,” he explained.
Sweeney also specifically noted that today’s layoffs are not related to AI. Impacted employees will receive a severance package with four months pay and, for US-based workers, six months of paid healthcare.
There were signs things weren’t going well earlier this month when Epic hiked the price of V-bucks — Fortnite’s in-game currency — saying simply that “the cost of running Fortnite has gone up a lot and we’re raising prices to help pay the bills.” As part of the news, Epic will also be winding down a trio of Fortnite’s game modes: Rocket Racing, Ballistic, and the Fortnite Festival “battle stage.” The main Fortnite Festival, a rhythm game developed by Harmonix that is headlined by a different pop star each season, will remain online.
“Market conditions today are the most extreme we’ve seen since [our] early days, with massive upheaval in the industry accompanied by massive opportunity for the companies that come out as winners on the other side,” Sweeney said in his note. “That’s what we’re aiming to do for our players, and we aim to bring other like-minded developers in the industry along on the journey to build an increasingly open and vibrant future of entertainment together.”