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Epic Games is laying off 16% of its staff

bloomberg.com

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Re: Epic Games is laying off 16% of its staff

#31

Post by giantg2 »

jsnell wrote: post #9
bluetidepro wrote: post #6

I wonder if this is related to the class action that is just now finally going through the submission phase for people: https://www.ftc.gov/news-events/news/press-releases/2023/03/...

No, those kinds of one-off events don't cause an otherwise profitable company to lay off people.

Sure it can. If the executives want to hit their performance bonuses they might start axing lower revenue projects or support groups. In a higher rate environment, it's certainly possible that the decision is made to lay people off to reduce the higher cost debt that needs to be incurred or the time it will take to pay it off, even if the company is otherwise profitable.not saying that's the case here though.

Of course there are other likely causes of layoffs, like a downturn in industry forecast for particular types of games, their next product didn't test well (or can't charge what they wanted), etc.

Re: Epic Games is laying off 16% of its staff

#32

Post by IKantRead »

sarchertech wrote: post #4

Wonder why the waited until after the layoff train was over.

Did tech fundamentals suddenly get sane or did the layoff train just stop at the AI hype station?

While I do believe AI (imho shorthand for LLMs and Diffusion models) has a lot of potential, it's main function has been to reignite irrational exuberance in the tech industry.

I work in this is space and I'm very curious how long the mania can hold out, and even more curious what the consequences will be for the people seriously working on AI when it dies down.

Layoff didn't stop because a correction had finally concluded, but because investors snorted another line of hype and were happy to throw their money around again and pretend everything is fine.

The come down from this, I suspect, will be pretty rough (but hey, if I'm wrong it's great for me).

Re: Epic Games is laying off 16% of its staff

#36

Post by n4r9 »

eigenvalue wrote: post #26

This is probably just continued post-COVID demand normalization. Basically all software and gaming got a massive bump that was obviously going to have an unsustainable component to it. But in many cases companies planned like it was totally sustainable and would continue. That’s why even super profitable companies like Microsoft and Epic are doing layoffs in 2023. The other reason of course is that they went a bit cr…

The first two paras I agree sound fairly likely.

Regarding the second para, the interesting part for me is: how do these companies determine which are the unproductive devs? My impression so far is that senior management has no way of measuring this, given how little data is provided to back up decisions to RTO.

Not so sure about the third para. Why would one company be more ahead of the game than any other, if indeed LLMs are providing this supposed boost?

Re: Epic Games is laying off 16% of its staff

#37

Post by BazookaMusic »

eigenvalue wrote: post #26

This is probably just continued post-COVID demand normalization. Basically all software and gaming got a massive bump that was obviously going to have an unsustainable component to it. But in many cases companies planned like it was totally sustainable and would continue. That’s why even super profitable companies like Microsoft and Epic are doing layoffs in 2023. The other reason of course is that they went a bit cr…

Anecdotal experience but most of the people I've seen being fired in one of the big ones are senior people working in customer facing roles, where the expectation is that they will be replaced by AI and wishful thinking.

Newly hired people were more junior and cheaper than previous employees so it makes no sense to fire them.

Re: Epic Games is laying off 16% of its staff

#38

Post by oblio »

n4r9 wrote: post #36
eigenvalue wrote: post #26

This is probably just continued post-COVID demand normalization. Basically all software and gaming got a massive bump that was obviously going to have an unsustainable component to it. But in many cases companies planned like it was totally sustainable and would continue. That’s why even super profitable companies like Microsoft and Epic are doing layoffs in 2023. The other reason of course is that they went a bit cr…

The first two paras I agree sound fairly likely. Regarding the second para, the interesting part for me is: how do these companies determine which are the unproductive devs? My impression so far is that senior management has no way of measuring this, given how little data is provided to back up decisions to RTO. Not so sure about the third para. Why would one company be more ahead of the game than any other, if indee…

They don't. They basically go by highest salaries and various arbitrary measures such as unprofitable division, virtual location, etc.

Re: Epic Games is laying off 16% of its staff

#39

Post by JumpCrisscross »

giantg2 wrote: post #31
jsnell wrote: post #9

Earlier quoted context omitted.

No, those kinds of one-off events don't cause an otherwise profitable company to lay off people.

Sure it can. If the executives want to hit their performance bonuses they might start axing lower revenue projects or support groups. In a higher rate environment, it's certainly possible that the decision is made to lay people off to reduce the higher cost debt that needs to be incurred or the time it will take to pay it off, even if the company is otherwise profitable.not saying that's the case here though. Of cour…

> If the executives want to hit their performance bonuses they might start axing lower revenue projects or support groups

This is not a reaction to an FTC case.

Re: Epic Games is laying off 16% of its staff

#40

Post by bpiche »

voisin wrote: post #27
BadBadJellyBean wrote: post #20

Is this my fault because of all the free games I claimed?

Tim Sweeney would like us all to agree that it is Apple’s fault for their App Store policies.

And he'd blame Valve, too. EGS might be great for devs, but it's not good for users. It's not a big conspiracy against him. People just don't want to use the store! Whining in the face of obvious failure makes you look like a real loser.
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