Epic Games is laying off 830 employees, which corresponds to 16 percent of the entire workforce. Company boss Tim Sweeney announced this in an internal memo, which the company has now made public. It states that the online music service Bandcamp, which was taken over just a year ago, is to be sold and a large part of the software subsidiary SuperAwesome is to be spun off, resulting in the loss of another 250 employees.
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Sweeney explains why his company has spent far more than it earned for too long. The hope of getting by without layoffs was unrealistic. Anyone who has to leave now will receive their salary for another six months; in the USA, Canada and Brazil, health insurance will also be covered during this period.
A “Leading Metaverse Company”
Sweeney still writes in the memothat the immensely successful online game Fortnite is growing again, but this is mainly due to content that comes from users. This means you earn less because the income generated is shared. Despite immense savings efforts, it was not possible to achieve “financial sustainability”. Layoffs are now the only way to stabilize the financial situation.
Work in the core business will continue largely unaffected by the layoffs, but some products will be delayed. Above all, the company sticks to its goal of making Fortnite a “Metaverse-inspired ecosystem for creators.” Epic Games will become a “leading Metaverse company,” says Sweeney.
Epic Games is one of the largest privately held video game companies, with Sweeney holding a majority of the shares. The company, founded in 1991, is now best known for the immensely successful Fortnite with its more than 400 million users worldwide. Epic also develops the Unreal Engine, which underlies many video games, and operates the Epic Games Store, an important Steam competitor. The layoffs that have now been made public follow similar job cuts at many other IT companies in the USA about a year ago.
(mho)