The video game industry continues to face significant challenges despite reporting record profits. Since 2023, a severe wave of layoffs and studio closures has swept through the sector, often driven by the pursuit of higher returns by shareholders and executives. This issue now impacts even the largest and most successful companies. Epic Games is the latest to announce substantial cuts, including the dismissal of over 1000 employees and the discontinuation of several Fortnite game modes: the musical mode Fortnite Festival: Battle Stage, the first-person mode Ballistic, and the racing game Rocket Racing are all set to cease operations on April 16, 2026.
In an official statement shared with employees and publicly posted on the company’s website, Epic Games expressed the following:
“Today, we are laying off over 1000 Epic employees. We regret having to reach this situation. The decline in Fortnite’s popularity, which began in 2025, means we are spending significantly more than we earn, and we must make substantial cuts to maintain the company’s funding. These layoffs, combined with over $500 million in savings from recruitment, advertising, and the elimination of some vacant positions, put us in a more stable position.”
Among the affected developers is Evan Kinney, an engineer who worked on the new Rivalry system, which had been very well-received by players.
Evan Kinney, an engineer known for his work on the Rivalry system, expressed his confusion on Twitter after being laid off: “guess who got laid off today! 🫠 i am genuinely so confused and bewildered like, i spent the past week debugging the rivalry system while recovering from pneumonia and just in the past few days i’ve had multiple directors tell me how much they appreciate everything i do”
The statement continued, noting that many of the economic challenges are not exclusive to Epic Games but affect the entire video game industry. They also clarified that the layoffs are not related to the use of AI.
Just weeks prior, Epic Games had announced an increase in V-Bucks prices for Fortnite, using a similar justification now cited for the layoffs: a supposed decrease in player engagement. This move drew significant criticism from players, especially since Epic had reported massive profits and high player numbers in 2025, largely due to game modes like Steal The Brainrot and The Simpsons-themed season. The company also introduced new, heavily criticized “predatory” monetization systems for player-created islands.
The community has strongly rejected the notion that price increases and layoffs are solely due to players not spending enough money in Fortnite. Many argue that Epic Games’ expenses on advertising, securing licenses for collaborations, and offering free games on the Epic Games Store are excessive, and blame should be directed at poor management decisions rather than players.
Others speculate that shareholders are simply dissatisfied that Fortnite isn’t generating as much revenue as platforms like Roblox (known for even more aggressive monetization practices) and are demanding higher profits. A segment of the community is now calling for the resignation of Tim Sweeney, Epic Games’ CEO, over the situation.
This marks a somber day for the video game industry. If developers cannot find stable employment with one of the most successful studios, responsible for one of the most played games of all time, what hope is there for others?
