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Fortnite developer Epic Games is set to lay off 870 employees as it seeks to lower costs, a Bloomberg report reveals. In a memo sent to workers earlier today, chief executive officer Tim Sweeney said the company had been spending a lot more money than it was earning for quite some time. He said: "I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see this was unrealistic."

On top of the news Creative Assembly's Hyenas has been cancelled before launch, which is leading to redundancies, it's been a particularly brutal day for the gaming industry.

The cuts at Epic Games will affect roughly 16 per cent of the workforce, and it seems Fall Guys developer Mediatonic has been hit hard. Multiple employees have taken to social media to share they've lost their job, including director and writer Ed Fear. "Unfortunately, I am one of the people affected by the layoffs today at Epic," he wrote on Twitter. "I'm absolutely devastated to leave behind so many amazing Mediatonic colleagues who I loved."

Epic Games acquired Mediatonic in March 2021 off the back of the huge success it experienced with Fall Guys. While it appears to be one of the worst studios hit, Mediatonic hasn't been closed down entirely, Jason Schreier reports. Tim Sweeney said no more layoffs at Epic Games are planned and that those who did lose their job were not part of teams in "core development".

"While Fortnite is starting to grow again, the growth is driven primarily by creator content with significant revenue sharing, and this is a lower margin business than we had when Fortnite Battle Royale took off and began funding our expansion," he explained. "Success with the creator ecosystem is a great achievement, but it means a major structural change to our economics."

[source bloomberg.com]