Fortnite Owner Epic Games Lays Off Over 1,000 Employees

Epic Games, owner and creator of popular game Fortnite, laid off 1,000 employees in response to declining engagement in the multiplayer game.

What’s Happening:

According to The Wrap, Epic Games CEO Tim Sweeney announced layoffs of over 1,000 employees and plans to cut $500 million in costs.
The cuts come amid declining engagement with Fortnite.
Sweeney cited industry challenges, slower growth, less consumer spending, tougher cost conditions, lower console sales, and increased competition from other entertainment.
He noted that some issues are specific to Epic Games, in addition to broader issues with the industry.
The CEO clarified that the layoffs are not related to AI and reaffirmed the company’s commitment to supporting developers and innovation.
Several game modes are also being removed in response to these changes include:
- Rocket Racing
- Ballistic
- Festival Battle Stage
Epic’s history includes milestones like Unreal Engine in the 1990s, Gears of War in the 2000s, and the shift to online gaming with Fortnite.
Affected employees will receive severance packages with at least four months of pay, plus additional compensation based on tenure.
U.S. employees will get six months of company-paid healthcare coverage.
The company is extending equity exercise windows to two years and accelerating stock vesting through January 2027.
More details about Epic Games’ future roadmap will be shared in an upcoming company meeting.

Disney and Epic Games:

Disney partnered with Epic Games back in February of 2024, with a commitment to bring Disney characters, games, and other content to Fortnite.
At this time, it is unlikely that these layoffs will affect Disney projects within Fortnite.

What They’re Saying:

Tim Sweeney, CEO of Epic Games: “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. 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… Despite Fortnite remaining one of the most successful games in the world, we’ve had challenges delivering consistent Fortnite magic with every season. We’re only in the early stages of returning to mobile and optimizing Fortnite for the world’s billions of smartphones; and in being the industry’s vanguard we have taken a lot of bullets in a battle which is only in the early days of paying off for ourselves and all developers… What we now need to do is clear: build awesome Fortnite experiences with fresh seasonal content, gameplay, story and live events; accelerate developer tools with greater stability and capability as we evolve from Unreal Engine 5 and UEFN to Unreal Engine 6. And we’ll be kicking off the next generation of Epic with huge launch plans towards the end of the year. Each time, we rebuilt our foundations and earned a renewed leadership position. Market conditions today are the most extreme we’ve seen since those early days, with massive upheaval in the industry accompanied by massive opportunity for the companies that come out as winners on the other side. That’s what we’re aiming to do for our players, and we aim to bring other like-minded developers in the industry along on the journey to build an increasingly open and vibrant future of entertainment together.”

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Fortnite Firings: Epic Games Lays Off More Than 1,000 Employees

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