More than 800 employees had to be laid off due to the expensive effort in the Fortnite meta universe. Details below
Video game company Epic Games announced this week the first The number of labor force decreased by 16%thanks to his ambitious and “unreal” efforts to enter the Art metaverse.
Fortnite developers have announced layoffs 830 employees and they left online music platform Bandcamp after spending “significantly more” money than planned.
Director General, Tim Sweeneyreported this action to the staff via e-mail in which he was responsible for the company’s expansion strategywhich sought to bring its iconic Fortnite brand into the burgeoning world of virtual environments.
“We’ve been spending far more money than we’ve been making for some time, investing in the next evolution of Epic and growing Fortnite as a meta universe-inspired creator ecosystem. I have long been optimistic that we could make this transition without layoffs, but in retrospect, I see that was unrealistic,” Sweeney wrote.
Sweeney also mentioned that Although the popular video game has started to experience new growth, it is mostly due to the content created by the creators.which means less revenue for Epic Games as the revenue is distributed more widely.
In addition to staff reductions, Bandcamp closing has been addedwhich was recently acquired, and a division of SuperAwesome, a child safety technology company that joined Epic in 2020.
Video game company Epic Games announces 16% layoffs
This will lead to even more layoffs.
The company said it is undertaking ongoing cost-cutting efforts at all of its offices around the world, and includes eliminating net hires and reducing operating expenses.
However, these measures were not enough and they decided to lay off hundreds of their employees.
“We’ve come to the conclusion that layoffs are the only way” to “achieve financial sustainability,” Sweeney said.
Problems in the metaverse end in layoffs
Ambitions to expand into the metaverse have been a major challenge for many prominent tech companies.
For example, Metaa well-known industrial giant, suffered significant losses in their metaworld division.
Meta is a prime example as it had to lay off 10,000 employees in March
In its latest report, published in July, the company behind Facebook revealed that losses had accumulated Laboratories of realityits division responsible for the development of virtual worlds accounted for more than 3,740 million US dollars during the second quarter of 2023.
In response to these new challenges, which also include a recent foray into artificial intelligence, Meta has decided to reduce its workforce.
In March announced the layoff of more than 10,000 employees and the cancellation of several projects.
The move follows a previous round of layoffs that took place at the end of 2022.
