Struggling to match the industry standards and survive inflation, American video game company, Epic Games, announced to cut 830 jobs and divesting online music platform Bandcamp.
Other than sending its 830 employees to home, the “Fortnite” maker will also spin-off most of SuperAwesome, which Epic Games acquired in 2020. SuperAwesome is a platform for developers to include kid-safety tools in their products.
“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,” CEO Tim Sweeney said in an email to employees, reported Reuters.
CEO Tim Sweeney also highlighted that around two-thirds of the layoffs were outside of core development teams. He also expressed his hopes that the recent job cut would helpt the company to “get to the other side of profitability.”
Slowdown and tough competition from new entrants a major setback
The videogame industry is reeling with a slowdown in spending. One of the main reasons is inflation-weary gamers becoming more selective in picking popular titles.
Legacy videogame publishers have also been fighting for top sports with new entrants like Warner Bros Discovery, whose “Harry Potter”-based game “Hogwarts Legacy” was a major hit.
Epic Games has also seen a legal battle with Apple since 2020, when the gaming firm alleged that Apple’s practice of charging up to 30% commissions on in-app payments on iPhones and other devices broke US antitrust rules. On Thursday, Apple asked the US Supreme Court to turn down an order that demands changes to its App Store rules stemming from the antitrust case.
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Updated: 29 Sep 2023, 06:43 AM IST
