Epic Games, the company behind the immensely popular video game Fortnite, is making significant changes that include cutting around 16% of its workforce, which amounts to 870 jobs.
Additionally, the company is selling Bandcamp, an online music platform it acquired just last year.
In a memo to its employees, Epic Games explained that despite their efforts to reduce costs, they were still spending more money than they were earning, leading to the difficult decision to implement layoffs.
CEO Tim Sweeney emphasized that these measures are necessary to stabilize the company’s finances.
Epic Games had already taken steps to control expenses, such as implementing a freeze on new hires and reducing operating costs related to marketing and events. However, these measures were insufficient to achieve financial sustainability.
As part of its restructuring, Epic Games will be selling Bandcamp, which it acquired in 2022. Bandcamp is known for providing independent artists with a platform where they can earn a more substantial income from their music compared to streaming services.
The acquisition of Bandcamp by Epic Games raised questions about how these two businesses would integrate, and this announcement indicates that the integration may not have been successful.
While the specific locations of the job cuts have not been disclosed, Tim Sweeney assured that these layoffs would not disrupt the company’s ongoing development or its core business operations.
He mentioned that the majority of the job reductions would affect teams that are not directly involved in core development.
Epic Games is renowned for its gaming engine, Unreal Engine, which powers various successful titles, including Fortnite and Gears of War.
Fortnite, in particular, boasts a massive global player base, with an estimated 400 million registered users.