Epic Games to Cut About 16% of Staff

5 months ago
Epic Games to Cut , About 16% of Staff.
The 'Fortnite' video game maker will lay off 870 employees, 16% of its workforce, in an attempt to cut costs, 'Bloomberg' reports.
CEO Tim Sweeney made the
announcement in a staff memo.
For a while now, we’ve
been spending way more
money than we earn, Epic CEO Tim Sweeney, via memo to staff.
I had long been optimistic that
we could power through this
transition without layoffs, but in
retrospect I see this was unrealistic, Epic CEO Tim Sweeney, via memo to staff.
Epic's 'Fortnite' Creator program,
which grants players the ability to create
and sell content within the game.
has been credited with driving most of the company's recent growth, 'Bloomberg' reports.
However, creators receive 40% of revenue, causing the endeavor to be "a lower margin business" compared to other revenue streams that the game provides, Sweeney said.
Those other revenue streams, like the ability to buy skins for characters, helped the company to rapidly expand.
But current profits can no longer
sustain the company's size.
Affected employees will reportedly receive severance pay and health insurance for six months
in addition to accelerated stock vesting.
Success with the creator ecosystem
is a great achievement, but it
means a major structural
change to our economics, Epic CEO Tim Sweeney, via memo to staff