This morning, Tim Sweeny sent out a note to employees saying that the company is laying off over 1,000 employees at Epic Games and that “significant cuts” would need to be made in order to “maintain the company’s funding.” He goes on to say that the layoffs are just part of the cost-cutting measures, and also cites more than “$500 million in identified cost savings in contracting, marketing and the closure of some vacancies.”

The post states that some of the issues are industry-wide, such as slower growth and weaker spending. However, there are also specific problems at Epic, particularly when it comes to the company’s big moneymaker, Fortnite. No, the game isn’t dying, but it’s not constantly making money. Still, Sweeny seems to be expecting an uptick once the game does well and re-establishes itself on mobile devices.

Sweeny further discusses what the company will do to deal with the current situation, focusing primarily on the company’s free-to-play battle royale, Fortnite. He also emphasizes that none of these layoffs are related to AI. However, he’s not trying to say they don’t use AI. Finally, he adds that those affected by the layoffs “will receive paid coverage for 6 months” and that the company will “accelerate the exercise of its stock options through January 2027 and extend stock vesting options for up to two years.” At least those laid off will have something to fall back on while they try to find a new landing spot.

Still, it’s hard. And it is not unlikely that we will see similar stories in the future.