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> "We're spending significantly more than we're making, and we have to make major cuts to keep the company funded," he said. Sorry, HOW?!? How can a company

> "We're spending significantly more than we're making, and we have to make major cuts to keep the company funded," he said. Sorry, HOW?!? How can a company like Epic games with one of the most successful gaming products of the last few decades be losing money with a product that is so mature? Almost every other games developer would love to be in their position on Fortnite but they've somehow turned that into a loss making proposition?!? I'm baffled.

josephg 7mo ago
They have ~5000 employees. Most game companies are a tiny fraction of that size. Even most AAA games are made by teams of hundreds. Not teams of thousands.
- filoleg 7mo ago
  Epic Games does way more than just purely making games. They also have their own Steam competitor (Epic Games Store) and, more importantly, they develop and support Unreal Engine used by tons of other game dev companies. If you want an apples to apples comparison (i.e., other big live-service game companies) in terms of the employee count, you got: Mihoyo (Genshin Impact, Honkai Star Rail) - ~5,000-6,000 Riot Games (League of Legends, Valorant) - 4,500 Roblox - 3,500
  - daedrdev 7mo ago
    Epic games store is likely a main culprit as they really have not succeeded while spending tons for free games Mihoyo literally prints money with predatory gacha Riot has had several layoffs in recent years Roblox loses tons of money every year
  - cubefox 7mo ago
    The game store doesn't need a lot of employees. A few years ago it was reported that Valve only needed about 70 employees to run Steam while it generated billions of dollars in Steam fees (30% per game). It's basically free money for Valve. I bet the situation is similar for the AppStore and Google Play. Though Unreal Engine does indeed need quite a few developers. Additionally, using UE is much cheaper (5% on games exceeding 1 milion USD gross revenue) than using Steam (30% on every game). So they not only need more developers than Valve, they also earn less money.
    - derektank 7mo ago
      Steam doesn’t really attempt to gatekeep submitted content the same way that Apple or Google do so I would expect those companies to have much larger teams supporting, in mostly non-development roles. Steam support has also historically been kind of a joke (not sure if it’s improved in the last 5 years) though I don’t know if Google/Apple provide a better experience
    - mxfh 7mo ago
      You know what contractors are?!
      - cubefox 7mo ago
        Yes. Do you have any evidence they use contractors for Steam?
        mxfh 7mo ago
        Can you do basic math on the number of support tickets Valve is handling to answer that question for yourself? if not: https://www.valvesoftware.com/en/jobs?job_id=113#:~:text=They%20further%20engage%20with%20external%20support%20partners%20to%20ensure%20users%20get%20the%20best%20experience%20when%20contacting%20support. https://www.valvesoftware.com/en/jobs?job_id=113#:~:text=The...
        cubefox 7mo ago
        > Can you do basic math on the number of support tickets Valve is handling to answer that question for yourself? Can you? Do you even know that number?
  - Strom 7mo ago
    What about Valve itself? They have ~350 employees. They make Steam, SteamOS, Steam Deck, Steam Machine, Steam Frame, the Source engine, and run four actively successful live service games: CS2, Dota2, TF2, Deadlock.
    - glenstein 7mo ago
      The small size of Valve is simultaneously mind boggling but also not, given its very intentional independence. I would have to imagine that they must contract out or have partners at least for their hardware relationships if not for their massively multiplayer online games. At just 350 people that's enough annual revenue to make everyone there a millionaire several times over. Simultaneously plausible but mind boggling.
      - _345 7mo ago
        They contract out all the time, they've admitted to it in lots of interviews. So I think through the amount of contracting they're able to keep their core hires down.
      - bsimpson 7mo ago
        It's well-known that most of the work on SteamOS is done by vendors on behalf of Valve (both individual kernel authors and agencies like Igalia).
    - Herbstluft 7mo ago
      Yeah but Valve is not publicly traded, so that comparison is of course totally unfair! /s Having skilled and happy employees that aren't constantly changing and do not spend all of their time on ways to fuck over customers and chase trends is simply impossible. Releasing a piece of hardware and leaving it open for customers to do with what they want? Linux? Not hiring people the second line goes up and then immediately firing them when line stagnates? Preposterous.
    - KaiMagnus 7mo ago
      Last I've heard Valve makes use of a lot of contractors however. So the number of people working on their projects is a bit higher than their employee count suggests. Anyone's guess how many though. I know they're sponsoring a bunch of ARM and Linux projects as well.
- raincole 7mo ago
  The biggest competitor to Unreal engine, Unity, once had ~8000 employees. And Unity doesn't even make games. (Not saying this is justified, of course. I think Unity is pretty much doomed.)
  - johnnyanmac 7mo ago
    Don't make games, but Unity does operate worldwide and has a LOT of supports for ads (their main money maker, unless something recent happened). That globalization is a big reason many tech companies swell. When you need a team to work in and around every region's laws and regulations, you get big quickly. But also, unity has slimmed down and scaled down on a lot of initiatives.
yifanl 7mo ago
Because games is simply not a particularly profitable industry. There's a reason why Valve moved on from making games to being a digital landlord.
- sph 7mo ago
  Citation needed.
  - yifanl 7mo ago
    Look at NVidia's stock price during the period when they announced a pivot away from gaming.
    - applfanboysbgon 7mo ago
      Nvidia doesn't make games, this is one of the worst takes I've ever seen on this site.
      - yifanl 7mo ago
        They made products that were effectively only targeted at the gaming audience, and when they pivoted, they were rewarded substantially, as the wider market recognizes how small the niche they used to be in was compared to where they are now.
        applfanboysbgon 7mo ago
        You have literally no fucking clue what you're talking about. The games industry is ~200 billion dollars per year. Film is 30, music is 60. Not only are games the largest entertainment sector, nothing else is even close. A hardware company pivoting to the AI bubble has literally nothing to do with the profitability of software.
        jasondigitized 7mo ago
        Because of basic economics. The opportunity size of AI for NVidia is unlike anything we have ever seen. Of course they pivoted.
CodesInChaos 7mo ago
The epic store with its giveaways and exclusivity deals is probably burning money.
- frakt0x90 7mo ago
  They explicitly stated this as a reason during their last layoff cycle.
- rdtsc 7mo ago
  Wonder how developers working on profitable parts feel about it. I’ve been at an employer who burned their cash on vanity projects and hubris and turned around to people working on the bread and butter profitable parts and said “sorry hard times hit, no bonuses this year, we have to tighten our belts”. It's when I left.
  - johnnyanmac 7mo ago
    That's pretty much every tech company these days. People wrongly claim they "over hired", but in reality these companies were trying to open up a half dozen new initiatives all at once. I worked at Unity and you'd be surprised what aspects were worked on (publicly, so I can pull it up if interested " that you probably never heard of. Those all shuttered as companies went into maintenance mode. I'm sure Epic has similar reactions. I remember them going pretty hard on cinema and architecture, but those have been quieter over the years.
- dylan604 7mo ago
  So I guess they are finding out that running an app store isn't very profitable and dare I say suggests that the percentage Apple charges was not unjustified?
  - raincole 7mo ago
    Seriously? Are you seriously making this argument? Are you seriously comparing running a PC app store vs App Store? One is the most open platform and the other has only one (1, uno, sole, single) app store.
applfanboysbgon 7mo ago
They aren't losing money on Fortnite, they're losing money on vanity projects like the Epic Game Store where they spend tens of millions of dollars for exclusivity deals with developers, and give away free games to try to poach Steam users with an otherwise inferior product. Unfortunately it is their employees that are paying the price of leadership making it rain with their overflowing coffers they couldn't help but burn.
- dclowd9901 7mo ago
  This was the first thing that came to mind with me as well: the language of the reasoning for the layoffs. It's never a leadership failure is it?
- Ethee 7mo ago
  It's still funny to me that they would rather burn 9 figures in cash on these silly deals to try and 'trap' gamers on their platform instead of just... I don't know... making a better platform? The reason nobody competes with Steam is simply the sheer number of integration and platform features that make it easy to buy, play and share games with my friends. It's not that hard, stop trying to 'force' me to use your platform. Just make it a nice experience.
  - yoyohello13 7mo ago
    > Just make it a nice experience. Haven’t you been paying attention? That’s not how we do things in business anymore…
    - lacy_tinpot 7mo ago
      It's truly incredible how difficult business people make doing business. Doing business is very simple, easy, and straightforward, but I suspect in a lot of cases the individual behavioral aspects of the executives get in the way of doing good business. Direction and leadership is something that these companies never seem to get right.
      - 7mo ago
duped 7mo ago
Fortnite is almost 10 years old, I'd be interested to see the average age of the playerbase. People have less time for games when they get older.
- littlecranky67 7mo ago
  My nephew was deep into Fornite for years - now at 15 he (and his friends) moved on to GTA V. Imagine what a treasure trove of gaming you can discover as a teenager today, looking back at a pool of 15-20years of great games.
  - ryandrake 7mo ago
    I started playing in my late 40s, but it got stale pretty quickly. Epic keeps changing things to try to keep it fresh, but they change the wrong things: usually making the game harder and more frustrating for casual players, in order to cater to pros and streamers. When I started playing, I could win a few matches if I got lucky. Three chapters / 15+ seasons later, I get spanked within 5 minutes of joining a match by people who live and breathe the game. I stopped playing because it's just not very fun for someone who just logs on once a week to play for a half an hour or so.
    - thunky 7mo ago
      > they change the wrong things: usually making the game harder and more frustrating for casual players, in order to cater to pros and streamers Interestingly the pros and streamers have the exact opposite complaint: that they dumb the game down for casuals. Can't please everyone/anyone.
- duderific 7mo ago
  My 11 year old son plays Fortnite almost daily. He plays other games too but Fortnite is what he plays with his friends online.
jasondigitized 7mo ago
This. You need to fire your CFO immediately if you don't have billions of dollars in cash after the run you just had on Fortnite.
- sysworld 7mo ago
  They should've setup an endowment fund, could've been self sustainable by now.
- xeromal 7mo ago
  They could have loads of money and still would need to tighten their belt once usage drops. I could have 100ks in my savings accounts but if my hours / salary was reduced at work, I would still reduce my spending. It's just being smart.
  - jasondigitized 7mo ago
    Yes, and that's what a good CFO is hired to do.
recursivecaveat 7mo ago
I think big media companies are just structurally unable to stop trying to double their revenue. They just keep pushing out more products and over-extend at the same time everyone is losing interest in them. That's how you end up with say the MCU producing at quadruple the old pace and the movies making less than ever. At some point there's just nowhere to go.
- someperson 7mo ago
  The Marvel Cinematic Universe is no longer "producing at quadruple the old pace". That peaked around 2022.
- HerbManic 7mo ago
  Epic is funny like that. They arent a publicly traded company and yet they act like one.
  - someperson 7mo ago
    Epic is 40% owned by Chinese conglomerate Tencent, which is publicly traded.
torginus 7mo ago
Kids who play video games grow up, and get off Fortnite, and you have to convince the next generation to sign up. And anyways, the population who plays these kind of live service shooters is relatively constant imo, and there are new games on the block nowadays. Actually what's an anomaly is how long Fortnite continued to be popular.
- MeetingsBrowser 7mo ago
  I don’t think this is necessarily what is happening. Roblox predates Fortnite by a decade and is only getting more popular over time
  - OkayPhysicist 7mo ago
    Tbf, "just make the next Roblox" is kind of an insane business proposition. Roblox has enjoyed unprecedented success at engaging the same age range for 20 years. Most games that are anywhere near that old have for the most part followed their playerbase as they aged. Runescape is a great example, where enough of their playerbase in 2013 were the same people who were playing 2007 that they demanded a reversion. Roblox, in contrast, has been extremely popular with 7-16 year olds for 20 years. They're funneling in new players faster than old players age out. It's pretty wild. My personal theory is that Roblox largely stepped into the amateur game dev hole that Flash left.
    - otabdeveloper4 7mo ago
      Roblox is a development platform, not a game.
  - lylejantzi3rd 7mo ago
    > I don’t think this is necessarily what is happening. This is exactly what happened with my niece, my nephew, and all of their friends. Which isn't to say they've outgrown all of the games they played when they were younger. They still play minecraft, stardew valley, kirby, mario, etc. I don't know why, but they all bounced off of Fortnite after they hit a certain age. I wonder why.
jayd16 7mo ago
It might be a case where they're projecting costs and a pessimistic Fortnite market a few years out. I doubt this something you do after the money is gone. You'd look ahead and see your runway in a down market is way too short and cut costs. You can't just bet the farm on dropping a new $5B/year game.
burnte 7mo ago
> "We're spending significantly more than we're making, and we have to make major cuts to keep the company funded," he said. The chances this is accurate are extremely small. This is either anticipating AI coding goals, the CFO proved they were overloaded on developers, or they're just cutting to hit quarterly numbers.
- keerthiko 7mo ago
  I'd be sad if "quarterly numbers" is a reason for a privately held company with 40% controlling stake still held by Sweeney to lay off 1K folks. As an indie dev, I generally like the guy's stance on shifting the PC gaming industry's support and financial incentive structures, so I'd be a bit surprised if he just did mass layoffs like Embracer and co. That said, the article implies things that aren't necessarily canon: "cut jobs as Fortnite engagement falls" doesn't mean "cutting people because Fortnite is flagging". It's much more likely because the Epic Game Store struggles to push enough volume to recover the cost of developer acquisition on the platform.
  - burnte 7mo ago
    If they're private I apologize, but I still don't think it has a real revenue reason, it's just copying what Block did last week.
Reason077 7mo ago
> ”Sorry, HOW?!? How can a company like Epic games … be losing money with a product that is so mature?” I’ve been playing Fortnite a bit lately, after my nieces got me into it. One thing is that although the player counts are high (always hundreds of thousands of players online, just in the main Battle Royale game), the average revenue per player can’t be that high. For one thing, once you’ve bought the $10 battle pass once, you only need to average maybe 1 or 2 games per day to earn enough vbucks to buy the next season’s battle pass with vbucks. So if you stay active you can pay once then play the game free forever and still get access to a huge amount of free cosmetics. And much of the player base is kids who are just begging their parents/uncles to buy them stuff in the game rather than spend money themselves because they don’t have credit cards to link to their Epic accounts. Compare this to something like Hearthstone which is similarly mature. They have a similar battle pass but there’s also a strong incentive to pay real $ for extra card packs and cosmetics. And there are clearly plenty of adult whales buying this stuff. For example, there’s a new mythic Deathwing skin on a gacha wheel that costs, on average, about $200 (!!) to get. It’s only been out a few days and I’ve run into multiple players who have it.
- bogdan 7mo ago
  Hearthstone battle pass isn't really comparable to Fortnite cosmetics. Hearthstone is pay 2 win where the majority of new cards are better than old ones.
  - FanaHOVA 7mo ago
    Everything in this comment is wrong lol
- SV_BubbleTime 7mo ago
  > you only need to average maybe 1 or 2 games per day to earn enough vbucks to buy the next season’s battle pass with vbucks. So if you stay active you can pay once then play the game free forever and still get access to a huge amount of free cosmetics. And much of the player base is kids who are just begging their parents/uncles to buy them stuff in the game rather than spend money themselves because they don’t have credit cards I lack the vocabulary to describe how fucking shit this is. Poor kids that have been sold into this versus the games we had that didn’t outright exploit. Kinda shame on you for contributing in to this. It’s gross.
downrightmike 7mo ago
All the lawsuits they are doing
johnnyanmac 7mo ago
>"We've had challenges delivering consistent Fortnite magic," Sweeney said, adding "market conditions today are the most extreme" since the early days of the company founded in 1991. Probably the closest way to say "we're in a recession and gaming isn't resistant to this one" I've heard yet. But it makes sense: a "free" service that entices with cosmetics is easy to cut when parent money gets tight. And if kids lose interest they will move to another game. Or more likely, TikTok and its medium. Just increasing the dopamine.
VoidWarranty 7mo ago
The store is quite a cost. They also have a billion engineers working in every different direction contributing to UE.
- pas 7mo ago
  if UE doesn't pay for itself they should just turn off the lights and sit in shame forever
LocalH 7mo ago
They pay out tons to "creators" of brainrot slop UEFN maps.
superultra 7mo ago
> Sorry, HOW?!? It's me. I have accumulated several dozen free games over the years through the Epic Store. Sorry Tim Sweeney!
- zvqcMMV6Zcr 7mo ago
  I love the whole "Thank you for adding free game to your account. Do you know you can download our launcher to actually play them?" message.
general_reveal 7mo ago
It’s done being built and they need fewer or cheaper people to maintain it.
paulddraper 7mo ago
> HOW?!? They are paying creators a lot. $220 million in 2023. [1] That combined with trying to undercut Steam on royalties, the 2025 softening of their cash cow, the Apple legal wars, a number of R&D bets, giving away free games, and an absolutely MASSIVE marketing budget...it can go fast. [1] https://naavik.co/podcast/fortnite-creative-origins/ https://naavik.co/podcast/fortnite-creative-origins/
autoexec 7mo ago
> Almost every other games developer would love to be in their position on Fortnite I seriously hope that isn't true because Fortnite is a showcase of nearly everything wrong with modern gaming. It's an ad platform/casino that prays on children and is designed to make them feel like shit by pumping them full of anxiety/FOMO over their various passes, gambling, and vbucks balance. I think the only good thing you can say for Fortnite is that it's not often pay to win (although there have been skins that gave players advantages over others) and it isn't run on child labor like roblox is. If Fortnite is actually losing players that's great news. I hope that most games developers would be ashamed to release a game like Fortnite and that the ads and predatory casino mechanics are something they'd choose to avoid in their own games.
Tiktaalik 7mo ago
I suspect they've been behaving like google in using a stable golden goose to fund moon shots, but unfortunately for them now that golden goose is rather sick and no longer making so many golden eggs.
rrgok 7mo ago
I bet the genius C level who came up with idea will get a huge bonus.
orloffm 7mo ago
Cosmetics suck. It's all the same rehashed "urban style" characters with the same design again and again. I don't want to buy those. I've bought some video game characters like Geralt, but that's it. They can do historical figures, old movie characters, national costumes and songs, maybe something military etc., but they don't. And I don't want to buy battle passes recently, they are boring and stupid, all those items from them only clutter the inventory that you have to clean manually.

josephg 7mo ago

They have ~5000 employees. Most game companies are a tiny fraction of that size. Even most AAA games are made by teams of hundreds. Not teams of thousands.

filoleg 7mo ago
Epic Games does way more than just purely making games. They also have their own Steam competitor (Epic Games Store) and, more importantly, they develop and support Unreal Engine used by tons of other game dev companies. If you want an apples to apples comparison (i.e., other big live-service game companies) in terms of the employee count, you got: Mihoyo (Genshin Impact, Honkai Star Rail) - ~5,000-6,000 Riot Games (League of Legends, Valorant) - 4,500 Roblox - 3,500
- daedrdev 7mo ago
  Epic games store is likely a main culprit as they really have not succeeded while spending tons for free games Mihoyo literally prints money with predatory gacha Riot has had several layoffs in recent years Roblox loses tons of money every year
- cubefox 7mo ago
  The game store doesn't need a lot of employees. A few years ago it was reported that Valve only needed about 70 employees to run Steam while it generated billions of dollars in Steam fees (30% per game). It's basically free money for Valve. I bet the situation is similar for the AppStore and Google Play. Though Unreal Engine does indeed need quite a few developers. Additionally, using UE is much cheaper (5% on games exceeding 1 milion USD gross revenue) than using Steam (30% on every game). So they not only need more developers than Valve, they also earn less money.
  - derektank 7mo ago
    Steam doesn’t really attempt to gatekeep submitted content the same way that Apple or Google do so I would expect those companies to have much larger teams supporting, in mostly non-development roles. Steam support has also historically been kind of a joke (not sure if it’s improved in the last 5 years) though I don’t know if Google/Apple provide a better experience
  - mxfh 7mo ago
    You know what contractors are?!
    - cubefox 7mo ago
      Yes. Do you have any evidence they use contractors for Steam?
      - mxfh 7mo ago
        Can you do basic math on the number of support tickets Valve is handling to answer that question for yourself? if not: https://www.valvesoftware.com/en/jobs?job_id=113#:~:text=They%20further%20engage%20with%20external%20support%20partners%20to%20ensure%20users%20get%20the%20best%20experience%20when%20contacting%20support. https://www.valvesoftware.com/en/jobs?job_id=113#:~:text=The...
        cubefox 7mo ago
        > Can you do basic math on the number of support tickets Valve is handling to answer that question for yourself? Can you? Do you even know that number?
- Strom 7mo ago
  What about Valve itself? They have ~350 employees. They make Steam, SteamOS, Steam Deck, Steam Machine, Steam Frame, the Source engine, and run four actively successful live service games: CS2, Dota2, TF2, Deadlock.
  - glenstein 7mo ago
    The small size of Valve is simultaneously mind boggling but also not, given its very intentional independence. I would have to imagine that they must contract out or have partners at least for their hardware relationships if not for their massively multiplayer online games. At just 350 people that's enough annual revenue to make everyone there a millionaire several times over. Simultaneously plausible but mind boggling.
    - _345 7mo ago
      They contract out all the time, they've admitted to it in lots of interviews. So I think through the amount of contracting they're able to keep their core hires down.
    - bsimpson 7mo ago
      It's well-known that most of the work on SteamOS is done by vendors on behalf of Valve (both individual kernel authors and agencies like Igalia).
  - Herbstluft 7mo ago
    Yeah but Valve is not publicly traded, so that comparison is of course totally unfair! /s Having skilled and happy employees that aren't constantly changing and do not spend all of their time on ways to fuck over customers and chase trends is simply impossible. Releasing a piece of hardware and leaving it open for customers to do with what they want? Linux? Not hiring people the second line goes up and then immediately firing them when line stagnates? Preposterous.
  - KaiMagnus 7mo ago
    Last I've heard Valve makes use of a lot of contractors however. So the number of people working on their projects is a bit higher than their employee count suggests. Anyone's guess how many though. I know they're sponsoring a bunch of ARM and Linux projects as well.
raincole 7mo ago
The biggest competitor to Unreal engine, Unity, once had ~8000 employees. And Unity doesn't even make games. (Not saying this is justified, of course. I think Unity is pretty much doomed.)
- johnnyanmac 7mo ago
  Don't make games, but Unity does operate worldwide and has a LOT of supports for ads (their main money maker, unless something recent happened). That globalization is a big reason many tech companies swell. When you need a team to work in and around every region's laws and regulations, you get big quickly. But also, unity has slimmed down and scaled down on a lot of initiatives.

yifanl 7mo ago

Because games is simply not a particularly profitable industry. There's a reason why Valve moved on from making games to being a digital landlord.

sph 7mo ago
Citation needed.
- yifanl 7mo ago
  Look at NVidia's stock price during the period when they announced a pivot away from gaming.
  - applfanboysbgon 7mo ago
    Nvidia doesn't make games, this is one of the worst takes I've ever seen on this site.
    - yifanl 7mo ago
      They made products that were effectively only targeted at the gaming audience, and when they pivoted, they were rewarded substantially, as the wider market recognizes how small the niche they used to be in was compared to where they are now.
      - applfanboysbgon 7mo ago
        You have literally no fucking clue what you're talking about. The games industry is ~200 billion dollars per year. Film is 30, music is 60. Not only are games the largest entertainment sector, nothing else is even close. A hardware company pivoting to the AI bubble has literally nothing to do with the profitability of software.
      - jasondigitized 7mo ago
        Because of basic economics. The opportunity size of AI for NVidia is unlike anything we have ever seen. Of course they pivoted.

CodesInChaos 7mo ago

The epic store with its giveaways and exclusivity deals is probably burning money.

frakt0x90 7mo ago
They explicitly stated this as a reason during their last layoff cycle.
rdtsc 7mo ago
Wonder how developers working on profitable parts feel about it. I’ve been at an employer who burned their cash on vanity projects and hubris and turned around to people working on the bread and butter profitable parts and said “sorry hard times hit, no bonuses this year, we have to tighten our belts”. It's when I left.
- johnnyanmac 7mo ago
  That's pretty much every tech company these days. People wrongly claim they "over hired", but in reality these companies were trying to open up a half dozen new initiatives all at once. I worked at Unity and you'd be surprised what aspects were worked on (publicly, so I can pull it up if interested " that you probably never heard of. Those all shuttered as companies went into maintenance mode. I'm sure Epic has similar reactions. I remember them going pretty hard on cinema and architecture, but those have been quieter over the years.
dylan604 7mo ago
So I guess they are finding out that running an app store isn't very profitable and dare I say suggests that the percentage Apple charges was not unjustified?
- raincole 7mo ago
  Seriously? Are you seriously making this argument? Are you seriously comparing running a PC app store vs App Store? One is the most open platform and the other has only one (1, uno, sole, single) app store.

applfanboysbgon 7mo ago

They aren't losing money on Fortnite, they're losing money on vanity projects like the Epic Game Store where they spend tens of millions of dollars for exclusivity deals with developers, and give away free games to try to poach Steam users with an otherwise inferior product. Unfortunately it is their employees that are paying the price of leadership making it rain with their overflowing coffers they couldn't help but burn.

dclowd9901 7mo ago
This was the first thing that came to mind with me as well: the language of the reasoning for the layoffs. It's never a leadership failure is it?
Ethee 7mo ago
It's still funny to me that they would rather burn 9 figures in cash on these silly deals to try and 'trap' gamers on their platform instead of just... I don't know... making a better platform? The reason nobody competes with Steam is simply the sheer number of integration and platform features that make it easy to buy, play and share games with my friends. It's not that hard, stop trying to 'force' me to use your platform. Just make it a nice experience.
- yoyohello13 7mo ago
  > Just make it a nice experience. Haven’t you been paying attention? That’s not how we do things in business anymore…
  - lacy_tinpot 7mo ago
    It's truly incredible how difficult business people make doing business. Doing business is very simple, easy, and straightforward, but I suspect in a lot of cases the individual behavioral aspects of the executives get in the way of doing good business. Direction and leadership is something that these companies never seem to get right.
    - 7mo ago

duped 7mo ago

Fortnite is almost 10 years old, I'd be interested to see the average age of the playerbase. People have less time for games when they get older.

littlecranky67 7mo ago
My nephew was deep into Fornite for years - now at 15 he (and his friends) moved on to GTA V. Imagine what a treasure trove of gaming you can discover as a teenager today, looking back at a pool of 15-20years of great games.
- ryandrake 7mo ago
  I started playing in my late 40s, but it got stale pretty quickly. Epic keeps changing things to try to keep it fresh, but they change the wrong things: usually making the game harder and more frustrating for casual players, in order to cater to pros and streamers. When I started playing, I could win a few matches if I got lucky. Three chapters / 15+ seasons later, I get spanked within 5 minutes of joining a match by people who live and breathe the game. I stopped playing because it's just not very fun for someone who just logs on once a week to play for a half an hour or so.
  - thunky 7mo ago
    > they change the wrong things: usually making the game harder and more frustrating for casual players, in order to cater to pros and streamers Interestingly the pros and streamers have the exact opposite complaint: that they dumb the game down for casuals. Can't please everyone/anyone.
duderific 7mo ago
My 11 year old son plays Fortnite almost daily. He plays other games too but Fortnite is what he plays with his friends online.

jasondigitized 7mo ago

This. You need to fire your CFO immediately if you don't have billions of dollars in cash after the run you just had on Fortnite.

sysworld 7mo ago
They should've setup an endowment fund, could've been self sustainable by now.
xeromal 7mo ago
They could have loads of money and still would need to tighten their belt once usage drops. I could have 100ks in my savings accounts but if my hours / salary was reduced at work, I would still reduce my spending. It's just being smart.
- jasondigitized 7mo ago
  Yes, and that's what a good CFO is hired to do.

recursivecaveat 7mo ago

I think big media companies are just structurally unable to stop trying to double their revenue. They just keep pushing out more products and over-extend at the same time everyone is losing interest in them. That's how you end up with say the MCU producing at quadruple the old pace and the movies making less than ever. At some point there's just nowhere to go.

someperson 7mo ago
The Marvel Cinematic Universe is no longer "producing at quadruple the old pace". That peaked around 2022.
HerbManic 7mo ago
Epic is funny like that. They arent a publicly traded company and yet they act like one.
- someperson 7mo ago
  Epic is 40% owned by Chinese conglomerate Tencent, which is publicly traded.

torginus 7mo ago

Kids who play video games grow up, and get off Fortnite, and you have to convince the next generation to sign up. And anyways, the population who plays these kind of live service shooters is relatively constant imo, and there are new games on the block nowadays. Actually what's an anomaly is how long Fortnite continued to be popular.

MeetingsBrowser 7mo ago
I don’t think this is necessarily what is happening. Roblox predates Fortnite by a decade and is only getting more popular over time
- OkayPhysicist 7mo ago
  Tbf, "just make the next Roblox" is kind of an insane business proposition. Roblox has enjoyed unprecedented success at engaging the same age range for 20 years. Most games that are anywhere near that old have for the most part followed their playerbase as they aged. Runescape is a great example, where enough of their playerbase in 2013 were the same people who were playing 2007 that they demanded a reversion. Roblox, in contrast, has been extremely popular with 7-16 year olds for 20 years. They're funneling in new players faster than old players age out. It's pretty wild. My personal theory is that Roblox largely stepped into the amateur game dev hole that Flash left.
  - otabdeveloper4 7mo ago
    Roblox is a development platform, not a game.
- lylejantzi3rd 7mo ago
  > I don’t think this is necessarily what is happening. This is exactly what happened with my niece, my nephew, and all of their friends. Which isn't to say they've outgrown all of the games they played when they were younger. They still play minecraft, stardew valley, kirby, mario, etc. I don't know why, but they all bounced off of Fortnite after they hit a certain age. I wonder why.

jayd16 7mo ago

It might be a case where they're projecting costs and a pessimistic Fortnite market a few years out. I doubt this something you do after the money is gone. You'd look ahead and see your runway in a down market is way too short and cut costs. You can't just bet the farm on dropping a new $5B/year game.

burnte 7mo ago

> "We're spending significantly more than we're making, and we have to make major cuts to keep the company funded," he said. The chances this is accurate are extremely small. This is either anticipating AI coding goals, the CFO proved they were overloaded on developers, or they're just cutting to hit quarterly numbers.

keerthiko 7mo ago
I'd be sad if "quarterly numbers" is a reason for a privately held company with 40% controlling stake still held by Sweeney to lay off 1K folks. As an indie dev, I generally like the guy's stance on shifting the PC gaming industry's support and financial incentive structures, so I'd be a bit surprised if he just did mass layoffs like Embracer and co. That said, the article implies things that aren't necessarily canon: "cut jobs as Fortnite engagement falls" doesn't mean "cutting people because Fortnite is flagging". It's much more likely because the Epic Game Store struggles to push enough volume to recover the cost of developer acquisition on the platform.
- burnte 7mo ago
  If they're private I apologize, but I still don't think it has a real revenue reason, it's just copying what Block did last week.

Reason077 7mo ago

> ”Sorry, HOW?!? How can a company like Epic games … be losing money with a product that is so mature?” I’ve been playing Fortnite a bit lately, after my nieces got me into it. One thing is that although the player counts are high (always hundreds of thousands of players online, just in the main Battle Royale game), the average revenue per player can’t be that high. For one thing, once you’ve bought the $10 battle pass once, you only need to average maybe 1 or 2 games per day to earn enough vbucks to buy the next season’s battle pass with vbucks. So if you stay active you can pay once then play the game free forever and still get access to a huge amount of free cosmetics. And much of the player base is kids who are just begging their parents/uncles to buy them stuff in the game rather than spend money themselves because they don’t have credit cards to link to their Epic accounts. Compare this to something like Hearthstone which is similarly mature. They have a similar battle pass but there’s also a strong incentive to pay real $ for extra card packs and cosmetics. And there are clearly plenty of adult whales buying this stuff. For example, there’s a new mythic Deathwing skin on a gacha wheel that costs, on average, about $200 (!!) to get. It’s only been out a few days and I’ve run into multiple players who have it.

bogdan 7mo ago
Hearthstone battle pass isn't really comparable to Fortnite cosmetics. Hearthstone is pay 2 win where the majority of new cards are better than old ones.
- FanaHOVA 7mo ago
  Everything in this comment is wrong lol
SV_BubbleTime 7mo ago
> you only need to average maybe 1 or 2 games per day to earn enough vbucks to buy the next season’s battle pass with vbucks. So if you stay active you can pay once then play the game free forever and still get access to a huge amount of free cosmetics. And much of the player base is kids who are just begging their parents/uncles to buy them stuff in the game rather than spend money themselves because they don’t have credit cards I lack the vocabulary to describe how fucking shit this is. Poor kids that have been sold into this versus the games we had that didn’t outright exploit. Kinda shame on you for contributing in to this. It’s gross.

downrightmike 7mo ago

All the lawsuits they are doing

johnnyanmac 7mo ago

>"We've had challenges delivering consistent Fortnite magic," Sweeney said, adding "market conditions today are the most extreme" since the early days of the company founded in 1991. Probably the closest way to say "we're in a recession and gaming isn't resistant to this one" I've heard yet. But it makes sense: a "free" service that entices with cosmetics is easy to cut when parent money gets tight. And if kids lose interest they will move to another game. Or more likely, TikTok and its medium. Just increasing the dopamine.

VoidWarranty 7mo ago

The store is quite a cost. They also have a billion engineers working in every different direction contributing to UE.

pas 7mo ago
if UE doesn't pay for itself they should just turn off the lights and sit in shame forever

LocalH 7mo ago

They pay out tons to "creators" of brainrot slop UEFN maps.

superultra 7mo ago

> Sorry, HOW?!? It's me. I have accumulated several dozen free games over the years through the Epic Store. Sorry Tim Sweeney!

zvqcMMV6Zcr 7mo ago
I love the whole "Thank you for adding free game to your account. Do you know you can download our launcher to actually play them?" message.

general_reveal 7mo ago

It’s done being built and they need fewer or cheaper people to maintain it.

paulddraper 7mo ago

> HOW?!? They are paying creators a lot. $220 million in 2023. [1] That combined with trying to undercut Steam on royalties, the 2025 softening of their cash cow, the Apple legal wars, a number of R&D bets, giving away free games, and an absolutely MASSIVE marketing budget...it can go fast. [1] https://naavik.co/podcast/fortnite-creative-origins/ https://naavik.co/podcast/fortnite-creative-origins/

autoexec 7mo ago

> Almost every other games developer would love to be in their position on Fortnite I seriously hope that isn't true because Fortnite is a showcase of nearly everything wrong with modern gaming. It's an ad platform/casino that prays on children and is designed to make them feel like shit by pumping them full of anxiety/FOMO over their various passes, gambling, and vbucks balance. I think the only good thing you can say for Fortnite is that it's not often pay to win (although there have been skins that gave players advantages over others) and it isn't run on child labor like roblox is. If Fortnite is actually losing players that's great news. I hope that most games developers would be ashamed to release a game like Fortnite and that the ads and predatory casino mechanics are something they'd choose to avoid in their own games.

Tiktaalik 7mo ago

I suspect they've been behaving like google in using a stable golden goose to fund moon shots, but unfortunately for them now that golden goose is rather sick and no longer making so many golden eggs.

rrgok 7mo ago

I bet the genius C level who came up with idea will get a huge bonus.

orloffm 7mo ago

Cosmetics suck. It's all the same rehashed "urban style" characters with the same design again and again. I don't want to buy those. I've bought some video game characters like Geralt, but that's it. They can do historical figures, old movie characters, national costumes and songs, maybe something military etc., but they don't. And I don't want to buy battle passes recently, they are boring and stupid, all those items from them only clutter the inventory that you have to clean manually.