Epic Lays Off 1,000 Employees After Fortnite Slowdown
Epic lays off 1,000 employees, officially announced in a blog post on March 24, the same day that Dark Outlaw announced the studio was shutting down. According to the blog post, the move was tied directly to the weak engagement with one of its biggest games, Fortnite.
Along with the layoffs, the Cary, North Carolina-based company is also cutting more than $500 million through changes to contracting, marketing, and open roles as it tries to steady the business.
According to Reuters, the layoffs were not connected to AI, which Epic made a point of saying in its staff memo. The Associated Press added that the cuts amount to about 20% of the company’s workforce, and Epic says it will have about 4,000 employees remaining after the reduction.
With Fortnite being one of the biggest games out there, it’s shocking to see that it was the result of these layoffs. But according to the official post, Fortnite caused unique challenges to Epic.
“Despite Fortnite remaining one of the most successful games in the world, we’ve had challenges delivering consistent Fortnite magic with every season; we’re only in the early stages of returning to mobile and optimizing Fortnite for the world’s billions of smartphones; and in being the industry’s vanguard we have taken a lot of bullets in a battle which is only in the early days of paying off for ourselves and all developers.”
Epic stated the downturn in Fortnite engagement began in 2025, and despite the high active players, average playtime has fallen. With playtime declining, that means fewer people are showing up and spending. With the game being free, they rely heavily on in-game purchases.
For instance, Epic raised V-Bucks prices early this month, saying the cost of running Fortnite had gone up.
What Changed for Fortnite?
AP reported that Epic is seeing pressure coming from multiple directions now. Now, not only is there a lack of spending, but slower growth and tougher cost economics are part of it as well. Along with that, games are fighting for attention against social media and other online entertainment.
And we can’t forget the oversaturization of battle royales over the last few years. And because of how many battle royales are out there, they’re slowly losing popularity. Dexerto reported that sandbox games are slowly dominating the multiplayer space.
But that’s not all. Another piece of this is mobile. Epic Games says it is still in the early stages of returning Fortnite to mobile and optimizing it for smartphone users after long legal fights over app store payments.
The company specifically pointed to those battles with Apple and Google as part of its own internal strain. That’s important because mobile should be a giant lane for a game with this kind of reach, and Epic is still trying to fully rebuild that path.
Profit Pressure
The profit is just not there for Epic, meaning they have to cut costs to keep the studio open. The company put it bluntly, saying they’re “spending significantly more than we’re making.”
So while Fortnite remains one of the most successful games in the world, the slow decline of engagement and lack of spending is causing issues for the studio.
