Epic Games will eliminate 1,000 jobs days after new Disney CEO Josh D'Amaro highlighted the partnership as a career-defining achievement, raising questions about the $1.5 billion investment's stability.
Epic CEO Tim Sweeney announced the March 24 layoffs in a digital memo to employees, citing a major downturn in Fortnite engagement in 2025 that left the company “spending significantly more than we're making.”
EPIC GAMES LAYS OFF OVER 1,000 EMPLOYEES
“Today we’re laying off over 1000 Epic employees. I'm sorry we're here again. The downturn in Fortnite engagement that started in 2025 means we're spending significantly more than we're making, and we have to make major cuts to keep the company funded. This layoff, together with over $500 million of identified cost savings in contracting, marketing, and closing some open roles puts us in a more stable place.”
EPIC GAMES LAYS OFF OVER 1,000 EMPLOYEES
"Today we’re laying off over 1000 Epic employees. I'm sorry we're here again. The downturn in Fortnite engagement that started in 2025 means we're spending significantly more than we're making, and we have to make major cuts to keep the… pic.twitter.com/Ibrsl1IFn3
— HYPEX (@HYPEX) March 24, 2026
Severance Package Details
Terminated employees will receive:
- Four+ months base pay based on tenure
- Six months Epic-paid healthcare (U.S.)
- Accelerated stock option vesting through January 2027
- Extended equity exercise window up to two years
Epic Games also removed open positions, eliminated contracting roles, and slashed marketing budgets. Sweeney says these measures put the company in “a more stable place.”
Not AI-Related
Sweeney clarified that the cuts don't stem from AI automation plans:
“I should note that the layoffs aren't related to AI. To the extent it improves productivity, we want to have as many awesome developers developing great content and tech as we can.”
Epic Games plans to accelerate seasonal Fortnite content releases to boost consumer spending. The company is transitioning from Unreal Engine 5 and UEFN to Unreal Engine 6 while improving developer conditions. Sweeney mentioned “huge launch plans towards the end of the year.”
Disney's $1.5 Billion Bet
The Walt Disney Company invested $1.5 billion in Epic Games in February 2024, acquiring minority ownership to integrate Disney entertainment and theme park properties into Fortnite.
D'Amaro, who became Disney CEO last week after replacing Bob Iger, previously called the partnership one of his most significant accomplishments, stating it “will redefine how fans play, create, and connect with Disney stories.”
Disney and D'Amaro haven't commented publicly on the Epic Games layoffs.
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