Epic Games eliminated more than 1,000 positions this week, its deepest round of cuts since 2023, as the Fortnite maker moves to close a widening gap between its spending and revenues amid a prolonged drop in player engagement.
Chief Executive Tim Sweeney disclosed the cuts in a memo published on Epic’s website. “The downturn in Fortnite engagement that started in 2025 means we’re spending significantly more than we’re making, and we have to make major cuts to keep the company funded,” he wrote.
The reductions amount to roughly 20% of Epic’s workforce. Alongside the job cuts, Sweeney announced more than $500 million in additional savings through lower contracting costs, reduced marketing spend, and leaving open roles unfilled. “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 said.
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Three Fortnite game modes — Rocket Racing, Ballistic, and Festival Battle Stage — face discontinuation in the coming months. Sweeney attributed the broader engagement slide to industry-wide pressures including weaker consumer spending, slower console sales, and competition from other entertainment platforms. He stated the cuts are “not related to AI.”
Affected workers receive at least four months of base pay, six months of company-paid healthcare coverage, and accelerated vesting of stock options through January 2027.
The company made its previous major workforce reduction in September 2023, cutting about 830 jobs — roughly 16% of its headcount at the time. Sweeney said Epic will hold a company-wide meeting to outline a product roadmap focused on fresh Fortnite content and the development of Unreal Engine 6. “Each time, we rebuilt our foundations and earned a renewed leadership position,” he wrote.
The cuts reflect pressure across the gaming industry. Tech sector layoffs globally have surpassed 55,000 since January 1, according to industry trackers, with economic uncertainty and shifting player habits weighing on studios of all sizes.
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