- Epic Games is laying off over 1,000 employees, about 20% of its workforce
- Layoffs follow a Fortnite engagement downturn that began in 2025
- CEO Tim Sweeney apologized and cited financial stability as the reason
Video game giant Epic Games announced on Tuesday (Mar 24) that it was laying off more than 1,000 employees, representing roughly 20 per cent of its workforce. In a memo to staff, CEO Tim Sweeney apologised for the situation, stating, "I'm sorry we're here again," in reference to the company's previous major layoff of 830 staff members in 2023.
Sweeney pointed to a major decline in Fortnite engagement starting in 2025 as the reason for his decision to ensure that the company remains in a 'stable place'.
"Today, we're laying off over 1000 Epic employees. I'm sorry we're here again. 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," said Sweeney.
"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."
Laid-off workers will receive a severance package that includes at least four months of base pay, with additional pay based on tenure. The company will also extend health care coverage for six months to US-based employees who have been laid off.
'Not AI-Related'
Sweeney highlighted that the cuts were not related to the emergence of artificial intelligence (AI) tools, adding that there were industry-wide challenges, including slower growth, weaker spending, and tougher cost economics.
"Since it's a thing now, I should note that the layoffs aren't related to AI. To the extent it improves productivity, we want to have as many awesome developers developing great content and tech as we can."
Sweeney said this is not the first time the company has found itself in torrid waters and that it will 'rebuild' itself over again.
"Epic survived upheavals in the 1990s with the move from 2D to 3D with Unreal 1; in the 2000's building console games with Gears of War; and in 2012 moving to online gaming with Paragon and Fortnite. Each time, we rebuilt our foundations and earned a renewed leadership position."
