Update: This story has been updated with more details and a more accurate layoff figure.

　　Over the past few years, Epic Games has been one of the biggest success stories in the industry. The massive popularity of Fortnite changed the entire gaming landscape, establishing the blueprint for a successful “live service” title. The profitability of Fortnite allowed Epic to do things like launch the Epic Games Store with better profit sharing for publishers, push a lot of cutting-edge new technology with Unreal Engine 5, and more. Unfortunately, it seems Epic’s run of unfettered success may have hit a speed bump.

　　According to Bloomberg’s Jason Schreier, Epic is laying off 870 employees, or around 16 percent of its total workforce. Even in today’s climate, where tech-related layoffs are increasingly common, that’s a pretty serious blow. Per Schreier, ex-Epic employees will receive 6 months of severance pay and continued health benefits.

　　NEWS: Epic Games, the maker of Fortnite and Unreal Engine, is laying off a whopping 16% of employees (or around 900 people), sources tell Bloomberg News. More to come

　　— Jason Schreier (@jasonschreier) September 28, 2023

　　In what’s likely a related move, Epic has also announced they’re raising the price of their most reliable source of income – Fortnite V-Bucks. These price increases will affect the United States, Czech Republic, Denmark, other Eurozone countries, Hungary, Japan, Norway, Poland, Romania, Sweden, and Turkey. Prices were already recently went up in Canada, the UK, and Mexico. The US prices for V-Buck bundles will now be as follows…

　　1,000 V-Bucks for $8.99 (currently $7.99)2,800 V-Bucks for $22.99 (currently $19.99)5,000 V-bucks for $36.99 (currently $31.99)13,500 V-bucks for $89.99 (currently $79.99)It's not a huge price hike, but again, the timing alongside these layoffs feels meaningful. Personally, I’ve always thought Epic’s approach, where they're very generous with their engines, store, ect. and make it up with Fortnite was kind of built on sand. No game, not even the mighty Fortnite, is going to be a guaranteed goldmine in perpetuity, particularly during a possible recession.

　　According to an internal email from Epic's Tim Sweeney seen by Schreier, the CEO admits "for a while now, we've been spending way more money than we earn." One area of the Epic's business that isn't delivering big profits is the recently-introduced Fortnite Creator program, which lets players design their own islands and modes. According to Sweeney, no more layoffs are imminently planned.

　　What do you think? Could Epic be in longer-term trouble? Or is this just a minor stumble?