Epic Games has confirmed plans to lay off more than 1,000 staffers and cut $500 million in costs amid a downturn in engagement with the company’s signature free-to-play, online gaming franchise, “Fortnite.”
The cuts represent about 20% of Epic’s headcount. “The remaining number of Epic employees is just over 4,000 after today’s layoffs of just over 1,000,” a rep for the games company said Tuesday.
Epic Games CEO Tim Sweeney disclosed the news in a memo to employees that was blunt about the company’s challenges.
“Today we’re laying off over 1000 Epic employees. I’m sorry we’re here again,” Sweeney wrote. “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. 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.”
Sweeney continued, “Some of the challenges we’re facing are industry-wide challenges: slower growth, weaker spending, and tougher cost economics; current consoles selling less than last generation’s; and games competing for time against other increasingly-engaging forms of entertainment.”
In February 2024, Disney invested $1.5 billion in Epic Games to take a minority stake in the gaming firm that has helped expand the concept of gaming eco-systems with the success of “Fortnite” and its many iterations.
Epic Games had a major layoff in September 2023, eliminating about 830 jobs, which represented about 16% of its workforce at the time.