It turns out buying up platform exclusivity and giving away free games every single week doesn’t make a lot of money, as Epic Games recently admitted.
Just yesterday during the ongoing Epic vs. Google court case, Epic Games Store vice president and general manager Steve Allison revealed that the Epic Games Store is not profitable yet and that “the goal is still growth,” according to a report by The Verge.
In 2021, Epic CEO Tim Sweeney said that giving away free games “has proven to be a fantastic success in reaching gamers with great games and a fantastic investment into growing the business.” But the business didn’t grow enough to prevent mass layoffs in September.
Two years later, while continuing to offer developers an enticing 88/12 split of revenue, Epic still lags behind Valve’s Steam on the PC platform while simultaneously operating at a loss. Epic’s goal of “hoping to claim half of all PC gaming revenue” is apparently a long, long way off.
Couple that with buying up exclusivity for multiple big-name PC titles (along with weekly free game giveaways) and it seems as though the store is still mostly relying on Fortnite for its revenue.
The news of the store’s failures is likely not to come as a surprise to the many who recently lost their jobs, including at Fall Guys developer Mediatonic, among several other departments throughout the company. And it won’t make them feel much better, either.
In another one of Epic’s last big court cases a couple of years ago, against another tech juggernaut in Apple, the company called out Epic’s big losses, including “at least $330 million in unrecouped costs from minimum guarantees alone,” according to The Verge. And Sweeney had a story to tell for that, too.
“Apple spins this as ‘losing money,’ but spending now in order to build a great, profitable business in the future is exactly what investment is,” he said. “It’s equally true whether you’re building a factory, a store, or a game.”
Sadly, Sweeney’s employees and all of those newly looking for jobs are still waiting for that investment to bear fruit.