Epic Games Cuts Over 1,000 Jobs as Fortnite Engagement Falls

Epic Games, the company behind one of the world’s most popular video games, has announced it is laying off more than 1,000 employees. CEO Tim Sweeney shared the news directly with staff in a company-wide note, citing a significant drop in Fortnite engagement that began in 2025 as the primary reason for the cuts.

“We’re spending significantly more than we’re making,” Sweeney wrote.

According to Sweeney, the financial strain comes from a combination of factors. some affecting the gaming industry as a whole and some specific to Epic. On the broader side, Sweeney pointed to slower industry growth, weaker player spending, current-generation consoles selling below expectations, and games having to compete for people’s time against other forms of entertainment.

For Epic specifically, Sweeney acknowledged that while Fortnite remains one of the most successful games in the world, the company has struggled to deliver consistent quality with each new season. He also noted that Epic is still in the early stages of bringing Fortnite back to mobile and optimizing it for smartphones globally.

Beyond the job cuts, Sweeney said Epic has identified over $500 million in cost savings across contracting, marketing, and unfilled roles. Together, these steps are meant to put the company on more stable financial footing. Employees affected by the layoffs will receive a severance package that includes at least four months of base pay, with additional pay depending on how long they worked at the company.

Despite the cuts, Sweeney outlined an active path forward. The company plans to focus on delivering fresh Fortnite seasons with new content, gameplay, and live events. Epic is also pushing ahead with its development tools, moving from Unreal Engine 5 toward Unreal Engine 6, with what Sweeney described as “huge launch plans” expected later this year.

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