Epic Games lays off over 1,000 employees as Fortnite engagement decline drains revenue

Epic Games CEO Tim Sweeney announced layoffs of over 1,000 employees, citing a Fortnite engagement downturn that began in 2025 and left the company spending significantly more than it earns. The cuts, combined with over $500M in identified savings from contracting, marketing, and open roles, are meant to stabilize the business ahead of a planned major launch toward the end of the year. Sweeney noted that affected employees will receive at least four months of base pay in severance, six months of Epic-paid healthcare in the U.S., and accelerated stock vesting through January 2027.