This note was sent by Epic Games CEO Tim Sweeney to Epic Games employees today:
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.
Some of the challenges we're facing are industry-wide challenges: slower growth, weaker spending, and tougher cost economics; current consoles selling less than last generation's; and games competing for time against other increasingly-engaging forms of entertainment.
And some of our challenges are unique to Epic. Despite Fortnite remaining one of the most successful games in the world, we’ve had challenges delivering consistent Fortnite magic with every season; we're only in the early stages of returning to mobile and optimizing Fortnite for the world's billions of smartphones; and in being the industry's vanguard we have taken a lot of bullets in a battle which is only in the early days of paying off for ourselves and all developers.
Since it's a thing now, 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.
What we now need to do is clear: build awesome Fortnite experiences with fresh seasonal content, gameplay, story, and live events; accelerate developer tools with greater stability and capability as we evolve from Unreal Engine 5 and UEFN to Unreal Engine 6. And we'll be kicking off the next generation of Epic with huge launch plans towards the end of the year.
This isn't our first time being here. Epic survived upheavals in 1990's with the move from 2D to 3D with Unreal 1; in the 2000's building console games with Gears of War; and in 2012 moving to online gaming with Paragon and Fortnite. Each time, we rebuilt our foundations and earned a renewed leadership position.
Market conditions today are the most extreme we've seen since those early days, with massive upheaval in the industry accompanied by massive opportunity for the companies that come out as winners on the other side. That's what we're aiming to do for our players, and we aim to bring other like-minded developers in the industry along on the journey to build an increasingly open and vibrant future of entertainment together.
At Epic, we pride ourselves in only hiring the industry's best, so it is very painful to part with so many talented people. The folks impacted by the layoffs will receive a severance package that includes at least four months of base pay, with more based on tenure. We’re also extending Epic-paid healthcare coverage.
For example, in the U.S., they’ll receive paid coverage for 6 months. We’ll also accelerate their stock options vesting through January 2027 and extend equity exercise options for up to two years.
We'll have a company meeting Thursday to talk about the roadmap in more detail.
-Tim
In addition to the layoffs Epic Games revealed a variety of titles/servers are shutting down.
We've built a lot of Fortnite modes, and in some cases we failed to build something awesome enough to attract and retain a large player base. We are going to shut these modes down on the schedules outlined below - we're grateful for everyone who played.
Rocket Racing
After two years of high-speed competition, Rocket Racing will leave Fortnite along with all UEFN islands built with Rocket Racing templates in October 2026. Starting next week, Rocket Racing Quests will no longer be available, and the current track creation template will be removed from UEFN. There are no further Ranked rewards planned for this season. Nothing changes with your Vehicle Locker and you can still use your customized cars in Fortnite.
For developers building car content, in April we’re adding car physics, hazards, and track-building tools (including the Track Spline tool and Speed Boost devices) to the base UEFN toolset. Developers will also be able to build custom racing islands with jumps, boosts, and drifting. Before October, developers will be able to move compatible Rocket Racing content over to standalone UEFN islands.
Ballistic
Ballistic will be removed from Fortnite on April 16, 2026 in the 40.20 release. You can still play and rank up in Ballistic during its final weeks. For developers, first-person shooter tools in UEFN remain available, and FPS creator islands will continue to be supported. In order for developers to build modes like Ballistic, more UEFN features will be required such as custom weapon support, ranked support, and additional matchmaking features.
Festival Battle Stage
Fortnite Festival consists of three music modes:
Festival Main Stage (one band with teams of up to 4, playing the "note highway" rhythm game), Festival Jam Stage (social island with casual music emoting), and Festival Battle Stage (a PVP game where 4 teams of 4 players play "note highway" rhythm gameplay competitively).
The Battle Stage competitive mode of Festival will go offline on April 16, 2026 with the 40.20 release and Quests will be available until then. Music remains a major part of Fortnite and we'll continue to improve Festival Main Stage and Jam Stage, and the music features that are available everywhere in Fortnite.