Epic Games to Cut About 16% of Staff

Epic Games to Cut About 16% of Staff

Epic Games to Cut , About 16% of Staff.

The 'Fortnite' video game maker will lay off 870 employees, 16% of its workforce, in an attempt to cut costs, 'Bloomberg' reports.

CEO Tim Sweeney made the announcement in a staff memo.

For a while now, we’ve been spending way more money than we earn, Epic CEO Tim Sweeney, via memo to staff.

I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see this was unrealistic, Epic CEO Tim Sweeney, via memo to staff.

Epic's 'Fortnite' Creator program, which grants players the ability to create and sell content within the game.

Has been credited with driving most of the company's recent growth, 'Bloomberg' reports.

However, creators receive 40% of revenue, causing the endeavor to be "a lower margin business" compared to other revenue streams that the game provides, Sweeney said.

Those other revenue streams, like the ability to buy skins for characters, helped the company to rapidly expand.

But current profits can no longer sustain the company's size.

Affected employees will reportedly receive severance pay and health insurance for six months in addition to accelerated stock vesting.

Success with the creator ecosystem is a great achievement, but it means a major structural change to our economics, Epic CEO Tim Sweeney, via memo to staff