News has broken of Epic Games freezing hiring, but while expansion is slowing down, the Fortnite creator remains committed to some of their most significant projects.
Update: Epic reached out to us with the following statement From Elka Looks, Director, Corporate Communications Epic Games:
“We’re not laying anyone off. We have ambitious plans to invest through the downturn and these cost control measures reinforce our plans. “
Below is the original article before Epic Games’ statement.
Epic Games is one of the biggest success stories in the last decade of gaming. While always notable for the Unreal Engine, Fortnite has occupied a dominant role in the gaming sphere for years now. The Battle Royale game boasts of being the first metaverse, and it just added a fully functional game builder to its platform in the form of URFN. Even Epic is not immune to the economic conditions, though, as a recent report of Epic Games freezing hiring has made clear.
According to correspondence received by Jacob Wolf, the developer is scaling back. While talk of actual layoffs is being avoided, Epic Games does look like it’s having to tighten up and ensure it hasn’t grown beyond what it can support.
Epic Games Freezing Hiring
Epic Games has been on a bit of a spending spree since Fortnite exploded in popularity. It has attempted some pretty big tasks, like taking on Steam with a direct competitor and trying to end the manufacturer’s cut of mobile app sales. The recent report from Jacob Wolf points towards their ambitions changing, though, with a distinct cutback coming for the company.
Epic Games will be moving to what they’ve called “net-zero hiring”. No expansion and much more thought put into replacing staff. According to Wolf, this means they will be applying for a more serious review on if there’s an actual need for a position as the employee leaves. They’ve been keen to stress that they’re not making layoffs. However, a right-sizing of sorts seems to be underway.
The emails received by Wolf talk about the company looking at all sorts of ways to save money. That’s reducing its outgoings on hosting but also cutting back on user acquisition. That’s something that might curtail the free on Epic Games Launcher system they’ve had for a while now.
This sounds more like a scaling back of expansion rather than direct layoffs. This isn’t too surprising, given the recent news. Most game companies have begun making layoffs lately, such as EA making sharp cuts. Epic clearly isn’t immune from the same economic conditions. They’re also restructuring their priorities, though, switching a focus to a few core components.
Epic Prioritizing Its Most Successful Projects
With the news of Epic Games freezing hiring, many fans might be wondering about some of those big projects that are still being worked on. Epic is shifting employees and its focus onto some of these significant projects, apparently dubbed “must succeed.” These represent major pushes. It’s possible that while Epic Games freezing hiring will be enough, a failure for one of these products would mean they had over-extended themselves.
These major projects include the Unreal Editor for Fortnite, the Lego metaverse collaboration, Fortnite Chapter 5, Hemronix Festival, and Rocket League Racing.
Some of these aren’t the most surprising. Fortnite continuing to thrive through more Chapters will be vital for Epic to stay at its current level in the gaming industry. Rocket League is another major tentpole for the company, and the Harmonix acquisition from Epic Games would understandably need some end result too.
The Lego collaboration has been known about, but not in much detail. It seems Epic Games freezing hiring isn’t stopping them from attempting large-scale projects. It might make the success of things like an Unreal Editor launching directly into Fortnite more critical for the company, though.
Is Epic Games Freezing Hiring a Bad Sign?
Epic Games isn’t immune to a downturn. In recent years they’ve extended their footprint in gaming massively. However, they’ve also extended their funding to facilitate this. While Fortnite makes plenty of cash, they’ve used funding rounds to keep their ambitious projects flowing. This has involved investments from the owners of Lego, along with Sony and Tencent.
The current downturn makes this kind of late-stage funding more difficult. Across the board, increased interest rates may be ending this brief period of cheap cash that has seen so many start-ups with gaming ambitions funded and others expanding rapidly. The company would also look at a more challenging time going public as a traded stock in light of these economic changes.
These kinds of moves from Epic signal that they’re trying to adjust to the changing landscape of esports and gaming investment. It isn’t a sign of a company struggling, at least compared to some of the more sweeping layoffs made by other developers this month. We can still expect to see Epic launching into a few more huge projects, at least provided those “must-succeed projects” keep succeeding.
