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Epic Games sheds 830 people due to 'spending way more money than we earn'

By - | Views: 48,278

Recent industry news doing the rounds is from Epic Games, who yesterday publicly shared an email that was sent by Tim Sweeney about laying off 16% of the company. 830 people lost their job due to "spending way more money than we earn" as they continue "investing in the next evolution of Epic and growing Fortnite as a metaverse-inspired ecosystem for creators".

That is a lot of people, and clearly shows that Epic Games have been relying a lot on Fortnite money. While Fortnite is "starting to grow again" Sweeney said it's being driven now by player-made content which has "significant revenue sharing, and this is a lower margin business than we had when Fortnite Battle Royale took off and began funding our expansion".

In the post Sweeney mentioned how Epic has been making efforts to reduce costs like "moving to net zero hiring and cutting operating spend on things like marketing and events" but all of this "ended up far short of financial sustainability" so getting rid of staff was "the only way" they could stabilize.

Epic is also selling off Bandcamp to B2B music company Songtradr, which they only acquired in 2022, as clearly they didn't actually have a business plan for it to sell it off so quickly. They're also spinning off most of SuperAwesome that they acquired in 2020, who say they are acquiring most of it back themselves directly.

Psyonix, maker of Rocket League, was also(1) affected(2) since Epic acquired them back in 2019 and then made it exclusive to the Epic Store.

The developer Mediatonic who made Fall Guys was also impacted by this, since Epic acquired them in 2021 and then made Fall Guys exclusive to the Epic Store. It's not clear how badly they've been affected but Ed Fear (Game Lead) who was laid off showed off a picture on X that showed "Decimated", with many others also posting about being let go so Mediatonic appears to have been hit quite hard by this.

No doubt the exclusives and constant free games on the Epic Store cost a lot of monies.

What do you think to this news? Leave a comment.

Article taken from GamingOnLinux.com.
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55 comments
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const Sep 29, 2023
They could have just gone to fair competition practices and turning their store into something viable, but laying of people is just so much easier.


Last edited by const on 29 September 2023 at 9:43 am UTC
lejimster Sep 29, 2023
Their whole business plan seems whacky to me and I'm surprised this hasn't happened sooner.


Last edited by lejimster on 29 September 2023 at 10:24 am UTC
StoneColdSpider Sep 29, 2023
Quoting: constThey could have just gone to fair competition practices and turning their store into something viable, but laying of people is just so much easier.
Bingo.......

As someone who has worked in mega large soulless corporations for over 2 decades........ They will always...... ALWAYS go the easy route........ Even if it blows up and costs them more in the long term....... The board and the CEO will just leave with their golden handshakes and someone else will come in with some other lazy solution to the current mess and the cycle continues.......

For example....... one company I worked for wanted software for a certain application....... Instead of getting the already employed company software engineers to make the software...... They scouted around and found another company that was making software that would fit their needs....... They then bought that company...... Then proceeded to fire everyone from the newly bought company......... AND then found out the software wasnt anywhere near finished and wasnt useable at all........

The CEO left with a multi million dollarydoo golden handshake and a new CEO came in and their solution was just to scrap the entirety of the code we had and go scouting for a third party to make the software........

And the kicker is that they didnt use the companies own software engineers because....... "The company did not see any value in getting them to make the software"........

I use to like reading Dilbert...... But hes now to close to reality to be funny........

Sorry for the off topic rant...... But this kind of stuff really *BEEPS* me off..........
Mountain Man Sep 29, 2023
I suspect a lot of Epic's potential customers are like me, who have dozens of games in their Epic account but haven't spent one cent on any of them. Basically, Epic trained their customers to just wait for the free games instead of spending money.


Last edited by Mountain Man on 29 September 2023 at 9:14 pm UTC
Pengling Sep 29, 2023
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  • Supporter
Quotea metaverse-inspired ecosystem
Quotemoving to net zero hiring
How many buzzwords does this guy use? Yikes!

Seriously, though, this is yet another example of why consolidation is bad for everyone. Why is it never the high-ups who took the company in this direction who lose their jobs for it?
Linux_Rocks Sep 29, 2023
BalkanSpy Sep 29, 2023
Even though I dislike the EGS, I dislike the idea of them going bust and losing all my games even more.
Also, Steam needs competition despite all of EGS shortcomings.
StoneColdSpider Sep 29, 2023
Quoting: PenglingSeriously, though, this is yet another example of why consolidation is bad for everyone. Why is it never the high-ups who took the company in this direction who lose their jobs for it?
Simple....... Its costs more in payouts to fire the CEO or Board or Upper management than it does to fire the office grunts...... Thats why the office grunts are the first to go......

Either get rid the CEO/Bored and pay up to tens of millions in golden handshakes........ Or fire a bunch of office grunts whos collective severance packages (if any) would be way less than even one million dollars........

I know its not right...... But that is reality.......
artixbtw Sep 29, 2023
Oh really? I'll be grabbing popcorn for this one
emphy Sep 29, 2023
Quote... as they continue "investing in the next evolution of Epic and growing Fortnite as a metaverse-inspired ecosystem for creators".
...

In other, more accurate, words: implement paid mods, slap on the "metaverse" label, and hope no one notices the bovine excrement in the press-releases/shareholder-reports.


Last edited by emphy on 29 September 2023 at 12:31 pm UTC
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