In a memo sent to staff the company explains that alongside 16 percent of staff being laid off, the company is also selling Bandcamp, and "spinning off" most of marketing company SuperAwesome.

CEO Tim Sweeney said that the company had beeen spending more money than it earned.

"I have long been optimistic we could power through this transition without layoffs, but in retrospect I see that this was unrealistic." It seems that Fortnite's failure to continue growing was part of the problem. Sweeney reports that it's "starting to grow again," but this is driven by creator content "with significant revenue sharing."

Despite efforts to reduce spending, Sweeney said the company still ended up far short of financial sustainability.

"These layoffswill "stabilise our finances. Laid-off Epic employees will receive six months severance and health benefits and an "all-hands meeting was happening shortly," Sweeney said.