What you need to know
- Apple has filed court documents detailing the Epic Games Store earnings.
- According to the documents, the store is expected to post losses of $273 million for 2020.
The Epic Games Store is not a source of revenue for Epic Games, and the company does not seem to care.
As reported by Ars Technica, Apple recently submitted court documents that detail the earnings, or lack thereof, of the Epic Games Store. According to the documents, the store incurred losses of $181 million back in 2019 and those losses are only expected to grow in the short term.
The raw numbers, as reported in a "Proposed Findings of Fact and Conclusions of Law" document Apple filed last week, show massive incurred and projected losses for Epic's game download hub, which launched in late 2018. Documents and testimony from Epic itself show a $181 million loss for the store in 2019 and projected losses of $273 million in 2020 and $139 million in 2021.
You might think Epic is incurring those losses because it only takes a 12 percent cut of third-party game revenues, compared to the industry-standard 30 percent cut on other digital storefronts. On the contrary, though—in its own court filings, Epic says that 12 percent revenue chunk has been "sufficient to cover its costs of distribution and allow for further innovation and investment in EGS."
The reason for the losses that Epic is seeing on the store has everything to do with the free titles that they offer to users on a rotating basis.
Add it all up, and Epic ended up paying a whopping $444 million in minimum guarantees in 2020, according to Apple's court filing (though that number could theoretically include future exclusives or free game deals). By contrast, Epic announced last year that players spent only $265 million on all third-party Epic Game Store games combined in 2020. In court documents, Epic also said it has paid out a total of over $700 million to third-party EGS developers so far. That suggests Epic has earned just $95 million through its standard 12 percent EGS revenue share.
While Apple claims that Epic will not see any positive revenue from the store until 2027, Epic Games believes they will reach profitability by 2023. The company has been able to use profits from other areas, like its immensely profitable Fortnite, to fund other ventures such as the store.
Epic Games continues its crusade against Apple as the companies are nearing a court date in the United States. Most recently, the studio opened up another antitrust lawsuit against Apple in the UK.