Epic Games has confirmed a major round of layoffs, with more than 1,000 employees set to lose their jobs as the company responds to declining Fortnite engagement and wider industry challenges.

In a message sent to staff and later shared publicly, CEO Tim Sweeney said the decision comes after a financial imbalance that began in 2025, with Epic “spending significantly more than we’re making.” The cuts are part of a broader effort to stabilise the company’s finances, alongside more than US$500 million in cost reductions across contracting, marketing, and unfilled roles.

Fortnite Engagement Decline Triggers Major Cuts

According to Sweeney, the downturn in Fortnite engagement that started in 2025 has been a key driver behind the layoffs. While Fortnite remains one of the most successful games globally, Epic has struggled to consistently deliver the kind of seasonal updates that keep players returning long-term.

Sweeney acknowledged that maintaining “Fortnite magic” every season has proven difficult, which has directly impacted player retention and, ultimately, revenue. That gap between spending and earnings is what forced Epic into making large-scale cuts.

The layoffs affect over 1,000 employees, making this one of the biggest job reductions in the gaming industry in recent years.

Industry Pressures And Epic’s Own Challenges

Epic pointed to a mix of broader industry trends and internal hurdles behind the decision. On the wider side, the company cited slower growth across gaming, weaker consumer spending, and tougher cost structures.

There are also shifting player habits to contend with. Games are now competing not just with each other, but with other forms of entertainment that are becoming increasingly engaging and time-consuming.

At the same time, some of Epic’s challenges are more specific. The company is still in the early stages of bringing Fortnite back to mobile platforms at scale, and is working to optimise the game for a global smartphone audience.

Sweeney also referenced Epic’s long-term strategy of pushing industry change, which has involved taking risks that have not yet fully paid off.

Layoffs Not Related To AI, Says Sweeney

Sweeney made a point of addressing a common assumption around job cuts in tech, stating clearly that the layoffs are not tied to artificial intelligence.

He explained that, if anything, improvements in productivity through technology would ideally allow Epic to support more developers creating games and tools, not fewer. The current cuts are instead tied directly to financial pressures and restructuring.

What Affected Employees Will Receive

Epic says impacted staff will receive severance packages that include at least four months of base pay, with additional compensation based on tenure.

For employees in the United States, the company will also provide six months of paid healthcare coverage. Stock options will be accelerated through January 2027, and workers will have up to two years to exercise their equity.

Sweeney described the layoffs as “very painful,” emphasising that Epic prides itself on hiring top talent and that the decision was not taken lightly.

Not The First Major Layoff At Epic

This isn’t the first time Epic Games has made large-scale cuts. Back in 2023, the company laid off around 830 employees, showing that the current situation is part of a longer period of restructuring.

Sweeney compared the current moment to previous turning points in Epic’s history, including the transition to 3D gaming in the 1990s, the move into console development with Gears of War, and the shift to online gaming with Fortnite.

However, he noted that current market conditions are among the most extreme the company has faced, combining both significant risk and potential opportunity.

What Comes Next For Epic Games

Looking ahead, Epic plans to focus heavily on improving Fortnite’s seasonal content, including gameplay, story, and live events, in an effort to rebuild engagement.

The company is also working on evolving its development ecosystem, moving from Unreal Engine 5 and Unreal Editor for Fortnite towards Unreal Engine 6, with a stronger emphasis on stability and capability for creators.

Sweeney hinted at “huge launch plans” later in the year, suggesting that Epic is aiming for a major reset moment as it tries to position itself for the next phase of the gaming industry.

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Unions representing Ubisoft employees in France have called for a large-scale international strike in February, escalating opposition to the company’s restructuring plans, return-to-office mandate, and sweeping cost-cutting measures.

The coordinated action follows Ubisoft’s announcement of a major internal reorganisation, which includes studio closures, project cancellations, and a mandatory five-day return to on-site work for all employees.

Five Unions Call For February Walkout

Five French unions, STJV, Solidaires Informatique, CGT, CFE-CGC, and Printemps Écologique, are urging Ubisoft staff worldwide to down tools from February 10 to February 12. Some union communications describe the action as extending into February 13, depending on local participation.

In a joint statement, the unions described the strike as a response to what they see as unilateral decision-making by management that disregards employee rights, existing agreements, and workplace wellbeing.

Restructuring, Cancellations, And €200 Million In Cuts

Last week, Ubisoft confirmed a sweeping overhaul of its studio structure, reorganising development under five new “Creative Houses.” While framed internally as a creative reset, the announcement immediately triggered project cancellations, studio closures, and fresh concerns about long-term job security.

The restructuring has already led to the cancellation of six games, including the long-delayed Prince of Persia: The Sands of Time remake, alongside multiple unannounced projects that were reportedly deep into development. Several studios are also set to close, with further consolidation expected as the new Creative House model takes effect.

Beyond internal disruption, the market reaction was swift and severe. Ubisoft’s share price fell as much as 33 percent following the announcement, marking one of the steepest drops in the company’s history. Investors reacted not only to the cancellations and closures, but also to Ubisoft’s confirmation that it plans to double down on generative AI initiatives despite mounting backlash from developers and players alike.

The company has also outlined a €200 million cost-cutting plan, which unions argue places the financial burden disproportionately on employees. As part of this effort, Ubisoft has launched a voluntary departure programme targeting 200 roles at its Paris headquarters, a move unions say is effectively a layoff strategy under another name.

Anger Over Return To Office Mandate

A central point of contention is Ubisoft’s decision to end remote work and require all staff to return to the office five days a week. Union representatives argue the move ignores agreements negotiated over the past year, with some studios having formal remote work policies in place since September 2025.

In their statement, the unions accused management of treating workers “like children who need to be supervised,” calling the mandate an arbitrary rollback of established working conditions.

Claims Of No Consultation Or Dialogue

Union leaders say employees learned of the restructuring, studio closures, and end of remote work at the same time as the media, despite mandatory consultations with worker representatives taking place only days earlier.

The statement directly criticises CEO Yves Guillemot, claiming senior leadership has failed to take responsibility for what unions describe as “catastrophic management” and a breakdown in constructive dialogue.

International Impact Remains Unclear

While labour protections in France make coordinated strike action more feasible, participation from Ubisoft’s international studios is less certain. Many of the company’s largest teams, including those in Canada, are not unionised, making strike involvement riskier for employees outside France.

The strike dates also coincide with Ubisoft’s next quarterly financial report on February 12, a timing unions suggest is intentional.

Whether the walkout will gain significant traction beyond France remains to be seen, but union leaders have framed the action as a line in the sand. “Without us,” the statement reads, “Ubisoft would never have conquered and transformed video games as it has. We are Ubisoft.”

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TLDR

Rockstar Games fired 34 employees for what it called gross misconduct, claiming they shared confidential information in a public forum. Union members and insiders say the real reason was retaliation against growing union activity, as the discussion involved Slack policy changes and workplace conditions, not GTA 6 leaks or sensitive project details. The Independent Workers Union of Great Britain has accused Rockstar of union busting and filed a wrongful dismissal case, while protests and employee support continue to grow.

A New Fallout at Rockstar

Rockstar Games is under heavy fire once again, and this time it is not for delays or leaks around GTA 6. The studio recently dismissed 34 workers for what it described as gross misconduct, claiming they shared confidential information on an external forum. But according to the workers, their union, and a detailed investigation by People Make Games, the story is far more complicated.

Screenshots shared by an insider show the messages Rockstar reportedly reviewed before the terminations. None of them appear to contain confidential game details, early GTA 6 information, or anything that resembles a leak. Instead, the conversations show staff discussing internal Slack policies and workplace conditions.

Slack Policy Changes Sparked the Controversy

In October 2025, Rockstar announced new Slack rules. Several non-work channels were removed, including hobby and games discussions. The studio said these channels had become distractions and contributed to poor conduct.

Because many of Rockstar’s UK staff cannot access work email outside the office, only employees who were physically present saw the policy change emails on time. Some of these staff copied quotes from the emails into a private Discord server so others could stay informed.

This Discord server was originally formed in 2022 and included both union and non-union members. After the Slack changes were posted there, one person reportedly approached management to raise concerns. People Make Games reports that this is what triggered an internal investigation, followed by Rockstar gaining access to the server and reviewing its chat history.

Workers Say Nothing Confidential Was Shared

Every insider who spoke to People Make Games said the same thing. They could not recall a single moment where confidential game details were revealed. No GTA 6 information, no technical documents, nothing that could harm the project.

Instead, messages show workers talking about Slack rules, staff bonuses, working conditions, and whether Rockstar had provided examples of the misconduct it was claiming. One employee even asked plainly, “Did they show any examples of misbehaving? Or is this all finger pointing without anything specific?”

According to the Independent Workers Union of Great Britain, this kind of conversation is completely normal and legally protected.

Union Leaders Call It “The Most Blatant Act of Union Busting”

Alex Marshall, president of the IWGB, says Rockstar has repeatedly tried to prevent staff from communicating with each other. He told People Make Games that discussing policies, pay, bonuses, and conditions is an ordinary part of workplace life.

Marshall said Rockstar’s response shows it is trying to govern by fear and limit transparency. The union claims this is the most ruthless union-busting action in the history of the games industry.

The IWGB has filed a wrongful dismissal case, accusing Rockstar and its parent company Take-Two Interactive of firing workers for legally protected union activity. Rockstar denies this and maintains its claim that confidential information was shared publicly.

Employee Support Surges Worldwide

The backlash has been immediate. More than 200 Rockstar North employees have signed a letter demanding the fired workers be reinstated. Protests have taken place in London and Edinburgh, with signs referencing Rockstar’s own themes of corporate satire and rebellion.

Fans and game developers online have echoed their support. One commenter summed up the community sentiment bluntly: “Rockstar and Take-Two are acting like the people their games parody.” Others have vowed not to cover GTA 6 until the workers are reinstated.

Even the IWGB confirmed publicly that the fired workers have seen the messages of support and are grateful as they navigate a difficult moment.

What Happens Next

The wrongful dismissal case will now move forward, and Rockstar may face increasing pressure from players, developers, and international labour groups. As excitement for GTA 6 continues to build, the controversy casts a shadow over the studio behind one of the most anticipated games in entertainment history.

For now, the workers remain out of their jobs, the union is pushing forward, and the industry is watching closely.

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