Epic Games has decided to lay off more than 1,000 employees, citing a downturn in Fortnite engagement, to put itself in a more stable pace.
"Today we’re laying off over 1000 Epic employees. I'm sorry we're here again. The downturn in Fortnite engagement that started in 2025 means we're spending significantly more than we're making, and we have to make major cuts to keep the company funded," the company said in a note to their employees.
The company added that the layoffs, along with more than $500 million in identified cost savings across contracting, marketing and unfilled roles, are intended to put it on a more sustainable footing.
2 March 2026
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Chief executive Tim Sweeney clarified that the job cuts are not linked to artificial intelligence, distancing the move from broader industry restructuring driven by AI adoption.
The employees impacted by the layoffs will receive a severance package that includes at least four months of base pay, with more based on tenure. Epic would also extend healthcare coverage.
This marks Epic's second major round of layoffs in after the company let go of 830 employees in September 2023, to boost profitability.
The cuts come at a time when the gaming industry is facing slower growth, weaker consumer spending and rising cost pressures. Companies are also competing more intensely for user attention against other forms of digital entertainment.
Reports suggest that in September, Electronic Arts laid off hundreds of employees and cancelled a Titanfall title under development. Meanwhile, broader workforce reductions at Amazon last year also impacted its gaming division.
Fortnite's Pressure
Epic acknowledged that while Fortnite remains one of the world’s most successful games, maintaining consistent engagement across seasons has become increasingly challenging.
The company said it is still in the early stages of expanding its mobile footprint and optimising Fortnite for billions of smartphone users globally. It also noted that its role as an industry pioneer has come with significant upfront costs, with returns from these investments yet to fully materialise.
