'Fortnite' maker Epic Games cuts 16% of staff after 'spending way more money than we earn'

Fortnite Battle Bundle
Epic Games, the video game developer behind the popular online game "Fortnite," is laying off 830 employees, the company announced Thursday. (Epic Games)

Epic Games, the developer behind the popular online game "Fortnite," is laying off 830 employees, the company announced Thursday.

The North Carolina-based firm, which also created the widely used Unreal Engine software for creating games, said in an email to staff that the layoffs account for roughly 16% of workers.

Tim Sweeney, the company's chief executive, told the staff that Epic had been "spending way more money than we earn" for "a while."

"I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic," Sweeney wrote in a memo posted to the company's website.

About two-thirds of the layoffs were in teams outside of core development, he said in the email.

The company is also selling its music program Bandcamp to Songtradr, a music licensing platform. About 250 employees were cut through the company's divestiture from Bandcamp and spinning off much of SuperAwesome, a kid-safe tech company.

"While 'Fortnite' is starting to grow again, the growth is driven primarily by creator content with significant revenue sharing," Sweeney said. "Success with the creator ecosystem is a great achievement, but it means a major structural change to our economics."

Laid-off employees will be offered six months base pay, and workers in the United States, Canada and Brazil will also receive six months of paid healthcare.

"Saying goodbye to people who have helped build Epic is a terrible experience for all," Sweeney said.

The company said in a post on its website that there will be no more layoffs. Epic will continue to hire for "critical roles."

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This story originally appeared in Los Angeles Times.