It’s another sad day for the industry as Epic is laying off 1,000 of its employees, at least partially owing to a slump in Fortnite‘s performance.

Epic boss – although he doesn’t seem very epic right now – Tim Sweeney posted the note he shared with company employees on the official Epic blog addressing the layoffs.

“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,” says Sweeney. “This layoff, together with over $500 million of identified cost savings in contracting, marketing, and closing some open roles puts us in a more stable place.”

“Despite Fortnite remaining one of the most successful games in the world, we’ve had challenges delivering consistent Fortnite magic with every season,” admits Sweeney.

Epic’s ongoing legal battles are also a large part of the problem, with Fortnite being unavailable on Apple for a while. It has only fairly recently reappared on iOS.

“we’re only in the early stages of returning to mobile and optimizing Fortnite for the world’s billions of smartphones,” admitted Sweeney.

It’s actually kind of staggering when you think about it. Fortnite users have been dropping significantly over the last year, yet revenue continues be extremely high, with 2025 expected to have been around $6-billion. But Sweeney is saying that they are spending more than the game is bringing in, suggesting the profit margin is tiny.

Why? Well, it’s probably a mixture of Epic paying Fortnite creators, hosting live events, paying licensing fees for stuff like Star Wars and then paying all of the staff tasked with actually keeping the whole thing running.

Still, it’s insane to consider, isn’t it? And yet here we are.

In other areas of the business, the Epic Store on PC continues to operate at a loss as far as we know. With Fortnite declining a little, it can’t offset things like the Epic Store as much.

“What we now need to do is clear: build awesome Fortnite experiences with fresh seasonal content, gameplay, story, and live events; accelerate developer tools with greater stability and capability as we evolve from Unreal Engine 5 and UEFN to Unreal Engine 6. And we’ll be kicking off the next generation of Epic with huge launch plans towards the end of the year,” said Sweeney.

None of this will matter to the people who have just lost their jobs, sadly. Epic is promising at least 4 months of severance pay plus more based on tenure. Healthcare is also being extended, plus some other financial help.