Epic Video games, the $31.5Bn valued sport developer behind common titles like Fortnite and Unreal Engine, introduced that will probably be shedding round 16% of its workforce, which is able to influence roughly 830 workers. Alongside these layoffs, the corporate additionally shared plans to divest its music platform, Bandcamp, and spin off most of its SuperAwesome providers.
In a memo posted on the Epic Video games web site, CEO Tim Sweeney defined that roughly two-thirds of the job cuts could be “outdoors of core improvement” to make sure that main initiatives and plans stay unaffected. Sweeney acknowledged that the corporate had been grappling with monetary imbalances as a consequence of its aggressive investments in Fortnite’s development and its evolution as a metaverse-inspired ecosystem for creators.
“As we shared earlier, we’re shedding round 16% of Epic workers. We’re divesting Bandcamp and spinning off most of SuperAwesome. For some time now, we’ve been spending far more cash than we earn, investing within the subsequent evolution of Epic and rising Fortnite as a metaverse-inspired ecosystem for creators. I had lengthy been optimistic that we might energy by way of this transition with out layoffs, however looking back, I see that this was unrealistic,” learn the official memo by Sweeney. “Whereas Fortnite is beginning to develop once more, the expansion is pushed primarily by creator content material with important income sharing, and this can be a decrease margin enterprise than we had when Fortnite Battle Royale took off and started funding our enlargement. Success with the creator ecosystem is a good achievement, nevertheless it means a serious structural change to our economics,” he added.
Along with the layoffs, Epic Video games is divesting Bandcamp, an unbiased music storefront it acquired simply final yr. Bandcamp might be bought to Songtradr, a music licensing platform. Songtradr has assured that it’ll proceed to function Bandcamp as a market and music group with a deal with an artist-first revenue-sharing mannequin.
SuperAwesome, identified for its kid-friendly providers, will endure a metamorphosis as properly. Its promoting enterprise will change into an unbiased firm beneath the SuperAwesome model, led by the present CEO, Kate O’Loughlin. Nonetheless, Children Internet Companies (KWS), the guardian verification and consent administration toolset, will stay part of Epic Video games.
To assist the workers impacted by these modifications, Epic Video games has introduced a severance package deal that features six months of base pay and 6 months of Epic-paid healthcare within the US, Canada, and Brazil. Moreover, they’re providing accelerated inventory choice vesting schedules by way of the top of 2024 and granting an extra two years from the date of the announcement to train inventory choices. Within the US, they’re providing to vest any unearned profit-sharing from workers’ 401(okay) plans and supply advantages reminiscent of profession transition providers and visa assist the place relevant. Moreover, the corporate assured that it’ll proceed hiring for crucial roles whereas sustaining a net-zero hiring coverage at its new measurement.