Epic Games has announced a string of lay offs, affecting over 800 employees as a means to cut costs. The company is also restructuring and divesting certain branches.
In an internal memo written by Epic Games CEO Tim Sweeney, it’s revealed that “around 16% of Epic employees” are being laid off unexpectedly. Additionally, Epic Games is divesting Bandcamp and is spinning off SuperAwesome, which was acquired in 2020.
The memo continues to cite that financial strain is at the core of the decision. “For a while now, we’ve been spending way more money than we earn, investing in the next evolution of Epic and growing Fortnite as a metaverse-inspired ecosystem for creators,” the CEO says. “I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic.”
In an effort to balance costs and budget, Sweeney continues to explain Epic Games pulled back on marketing and events. However, despite all of the company’s attempts, Sweeney says Epic Games “still ended up far short of financial sustainability. Because of this, it was unapologetically determined that “layoffs are the only way.”
Bandcamp is confirmed to be divested and joining Songtradr, the music marketplace. The ads business of SuperAwesome is also to become an independent company under the brand.
As for the marquee titles under Epic Games’ belt, the development of content for Fortnite continues. Epic Games also claims Rocket League and Fall Guys are being invested in alongside Unreal Engine.
Those affected are said to be offered a severance package which includes six months base pay. Those in Canada, the U.S. and Brazil, former employees will receive six months of Epic-paid health care. Accelerated stock option vesting schedules are also being offered until the end of 2024. Two additional years from today are included to use these options. Career transition services and Visa support are also being offered to those being laid off.
Epic Games’ layoffs come only weeks after chief creative officer and Fortnite lead Donald Mustard retired from his position. It also comes after the industry has seen many layoffs across the board. This includes the recent news that Embracer Group shut down Volition, the studio behind Saints Row.
Image credit: Epic Games
Via: The Verge