Epic Games Faces Financial Crisis and Layoffs, CEO Admits

Epic Games CEO Tim Sweeney admitted during Unreal Fest that the company faced a "financial problem" 10 weeks before announcing layoffs. Sweeney stated that the layoffs were a necessary survival move to stabilize the company's finances and avoid running out of money. Epic Games heavily relied on the revenue from Fortnite, but despite its success, the company was spending more than it was making. The ongoing legal feud with Apple and generous revenue splitting were cited as costly ventures. To expand revenue streams, Epic plans to increase the price of Unreal Engine but not for game developers, instead opting for a "seat-based" pricing model.