- Epic Games is currently engaged in a court battle against Google.
- The company revealed that it is still looking to grow due to the lack of profits from the storefront.
- The lack of profits comes from aggressive promotions and offers to attract consumers.
PC gaming is dominated by Steam, the two-decade-old storefront. However, in 2018, Epic Games sought to challenge this dominance, launching its own store to compete against Valve on PC.
Unsurprisingly, the platform struggled to find its footing at first. However, several years later, Epic confirms that its store is still not profitable.
Why it matters: Despite Epic Games’ assertion that its spending was part of a strategy, the reality is that the storefront failed to generate profit and incurred losses.
The company is currently engaged in a court battle over antitrust laws against Google. On the opening day of this court case, Epic Games Store general manager Steve Allison declared that the store was not profitable with the following words:
“The goal for the Epic Games Store is still growth.”
Since 2018, the platform has introduced various incentives to attract customers over existing platforms like Steam. This includes weekly giveaways, massive discounts, and more.
Huge games like GTA 5 and the Batman Arkham trilogy were given away for free. The company also incentivized developers to publish their titles on the platform by offering over 80% of revenue for each sale on the storefront.
Additionally, it relied on exclusivity deals, with games like Alan Wake 2 being recent examples of digital-only releases limited to this store. All of this led to poor revenue for Epic Games.
As early as 2021, CEO Tim Sweeney asserted that the company was losing more than $300 million on the Epic Game store. According to him, this was part of the overall business plan.
Unfortunately, these measures have not brought the results he had hoped for. Recently, Epic Games laid off over 800 developers, highlighting its struggles. The CEO believes the declining spending on Fortnite microtransactions has played a role in the company’s current problems.
We believe Epic Games’ approach of throwing money to attract more consumers may not be very practical. While we don’t mind receiving discounts and free games, the company should consider other ways of growing its platform.
At the very least, Fortnite is still going strong.
The game recently reached a new high after bringing back the classic map and various items. In addition to reaching over 6 million concurrent players, Fortnite saw over 44 million players in just a single day, thanks to the ongoing event.
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[News Reporter]
Bawal is an MBBS student by day and a gaming journalist by night. He has been gaming since childhood, growing fond of the creativity and innovation of the industry. His career as a gaming journalist started one year ago, and his journey has allowed him to write reviews, previews, and features for various sites. Bawal has also been cited in reputed websites such as Screenrant, PCGamesN, WCCFTech, GamesRadar, and more.
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