Epic Games announced more than 1,000 job losses in a recent layoff, according to CEO Tim Sweeney in a note posted online. This follows the company cutting 830 staff in September 2023. Sweeney attributed the layoffs to a downturn in Fortnite engagement starting in 2025, which has caused the company to spend more than it makes.
CEO Tim Sweeney detailed that the layoffs, along with over $500 million in cost savings from contracting, marketing, and closing open roles, put Epic Games in a more stable place. He also blamed industry-wide challenges, including slower growth, weaker spending, and tougher cost economics. One of Epic Games' biggest costs has been its expensive legal actions against Google and Apple, according to Sweeney.
Fortnite makes around $4 billion a year in revenue and is the fourth most played PC game in the world. Epic Games is estimated to have made $6 billion in revenue in 2025, highlighting the game's dominant market position within the company's broader financial landscape.
Multiple reports indicate that games are getting more expensive to make, but growth is stalling. Companies took on too many staff during COVID due to a massive boost in sales and the belief that people would not go outside again, according to major media sources. There is more competition from social media and streaming, and attention is a finite commodity, as noted in multiple reports, contributing to the broader industry pressures.
Publishers spend hundreds of millions on new live-service multiplayer games and shut them down quickly if they don't become instant hits like Minecraft or Fortnite, according to major media sources. Examples of short-lived live-service games include Xdefiant, which lasted a few months, Highguard, which lasted a month, and Concord, which lasted two weeks, as reported by multiple outlets, illustrating the volatile nature of this market.
Three Fortnite modes are being removed: Rocket Racing, Fortnite Ballistic, and Fortnite Festival Battle Stage, according to multiple reports. Rocket Racing will be shut down in October 2026, and Fortnite Ballistic will be shut down on April 16, 2026, as indicated by major media sources, as part of the company's restructuring efforts.
Fortnite Festival Battle Stage is the competitive mode of the rhythm-based mode, while Main Stage and Jam Stage modes will remain, according to multiple reports. Epic Games recently increased the price of V-Bucks to help pay the bills, as noted by major media sources, reflecting ongoing financial adjustments.
Epic Games is the publisher behind Fortnite, which includes LEGO Fortnite, according to research. The LEGO Group partnered with Epic Games in 2022, and KIRKBI, the LEGO Group's parent company, invested $1 billion into Epic Games in 2022, based on research findings, underscoring the strategic partnership.
LEGO Fortnite has received steady updates since its launch, according to research. The layoffs could affect LEGO Fortnite due to the loss of 20% of the workforce, as suggested by research, raising concerns about potential impacts on development and future updates.
Key unknowns include the specific date in 2025 the recent layoffs were announced or occurred, and how the $6 billion estimated revenue for Epic Games in 2025 breaks down beyond Fortnite's $4 billion contribution. The exact current total number of employees at Epic Games is also unknown, which affects reconciliation of the layoff percentages: Epic Games laid off 1,000 employees, which is 20% of its total workforce, but some reports suggest it laid off roughly 16% of its staff.
Remaining uncertainties include what specific cost savings measures beyond contracting, marketing, and closing open roles are included in the over $500 million mentioned by Sweeney. Additionally, the timing details of the layoffs and their direct effects on projects like LEGO Fortnite have not been fully disclosed, leaving questions about the broader implications for the company's operations.